(Updates to European market close)
* U.S. dollar sees fourth week of losses, bond yields fall
* U.S. payrolls rise beats estimates, hourly earnings slip
* Oil up after U.S. flags sanctions on Iran
* Copper hits 2-week low on strike fears, China rate hike
By Dion Rabouin
NEW YORK, Feb 3 Key world stock indexes rose on
Friday, with U.S. equities near record highs, amid data showing
the creation of more U.S. jobs than expected, while President
Donald Trump's executive order to review banking regulations
boosted financial sector shares.
Still, the U.S. dollar headed for its fourth straight weekly
loss and bond yields slipped after wage growth slowed in the
monthly U.S. employment report, suggesting the Federal Reserve
may not raise interest rates again soon.
U.S. non-farm payrolls increased by 227,000 jobs last month,
the largest gain in four months, but wages increased only
modestly, suggesting there was still some slack in the labor
"Continued strong job creation is tempered by the renewed
sluggishness in wage growth, raising questions once again about
the extent to which the functioning of the labor market has
evolved," said Mohamed El-Erian, chief economic adviser at
Allianz in Newport Beach, California.
The Dow Jones Industrial Average rose 167 points, or
0.84 percent, to 20,051.91, the S&P 500 gained 14.59
points, or 0.64 percent, to 2,295.44 and the Nasdaq Composite
added 19.32 points, or 0.34 percent, to 5,655.52.
MSCI's all-world stock index, which tracks
bourses in 46 markets, rose 0.45 percent, on pace for its third
day of gains.
U.S. Treasury yields fell on the disappointing wage growth
numbers, indicating inflation may not rise at a pace that would
lead the Federal Reserve to raise rates soon.
Benchmark 10-year Treasury prices rose 2/32 to yield 2.47
percent and the lower yields undermined the dollar, which
had risen in early trading on expectations of a solid reading.
The U.S. dollar has been hit in recent weeks by uncertainty
about policy direction amid a flurry of executive orders by
Trump, after an initial burst of enthusiasm spurred by the new
administration's promises of tax reform, infrastructure spending
and financial deregulation.
Trump is expected to order a review of the Dodd-Frank Act on
Friday, which was implemented in the aftermath of the 2008
financial crisis to prevent a repeat of the worst financial
crash since the Great Depression.
Sterling steadied after its worst fall since October.
The euro, which was set for its sixth week of gains in
seven, was at $1.0765, having climbed as high as $1.0829 after
the latest signs that growth and inflation are rising in the
European stocks gained broadly with the STOXX 600
rising 0.6 percent, rebounding from losses in the previous
session. The index was negative for the week as caution about
the impact of Trump's policies weighed on a rally in risky
Euro zone corporate earnings have been strong so far and a
survey on Friday showed euro zone businesses started 2017 by
increasing activity at the same multi-year record pace they set
in December, and faster growth in demand suggested the good
times will continue.
Oil prices rose after U.S. threats of new sanctions against
Iran. Comments by Russian Energy Minister Alexander Novak that
oil producers have cut their output in accordance with a pact
agreed in December also helped to support prices.
Crude futures were up 0.2 percent with Brent crude
set to gain more than 2 percent for the week.
London copper was down 2 percent on the day, hitting
its lowest in two weeks. The decline came after workers
restarted wage talks at the largest copper mine in Chile and
China increased its interest rates, sparking concern about a
clampdown on speculators.
(Additional reporting by Vikram Subhedar in London and Danilo
Masoni in Milan; Editing by Clive McKeef and Bernadette Baum)