* Wall St touches record high, then retreats on Nasdaq slide
* Dollar slips as solid U.S. jobs data suggests less
* Brent rises from 5-month low to above $106
* Bond yields dip after data, fears of early rate hike ease
(Adds oil settlement)
By Herbert Lash
pulled Wall Street and a measure of global equities lower on
Friday despite a solid U.S. jobs report that weakened the dollar
on views that the Federal Reserve will keep scaling back its
The U.S. bond market surprisingly rallied, particularly
five-year Treasury notes, which had been weak lately on fears
the Fed could raise interest rates earlier than anticipated.
The FTSEurofirst 300 index of European shares
touched a peak last seen in 2008 on the jobs data and closed
higher, marking nine straight gains and three consecutive weeks
of higher closes.
But stocks on Wall Street retreated after stabilizing
earlier in the week as momentum stocks such as biotechs fell for
a second straight session. The Nasdaq biotech index lost
3.95 percent and the Nasdaq composite fell 2.5 percent, pulling
down U.S. stocks and global equities.
"You've got some big names in there. There is a high
correlation inside of those groups," said Keith Bliss, senior
vice-president at Cuttone & Co in New York. "Managers tend to
trade the entire group as opposed to individual names. So that
of course, is hitting the Nasdaq and everybody else."
Equities had opened higher on optimism spurred by the U.S.
nonfarm payrolls report, which showed jobs increased by 192,000
in March, just shy of the 200,000 forecast, after rising 197,000
in February. The unemployment rate was unchanged at 6.7 percent.
With a solid pace of hiring for a second month, the U.S.
economy appears to be recovering from a winter slowdown.
A smaller survey of households, from which the unemployment
rate is derived, showed a much bigger surge in employment. That
jump was met by a rise in the number of people entering the
labor force, a show of confidence in the U.S. job market.
The percentage of working-age Americans with a job reached
its highest level since the summer of 2009.
"Overall, people are taking this as a sign there isn't some
sort of underlying weakness in the economy," said Kate Warne,
investment strategist at Edward Jones in St. Louis.
"It has fit into people's belief that most of the weakness
we saw earlier was due to the weather and not something really
changing about the economy."
all-country world stock index fell 0.3 percent.
The Dow Jones industrial average fell 145.74 points
or 0.88 percent, to 16,426.81, the S&P 500 lost 21.59
points or 1.14 percent, to 1,867.18 and the Nasdaq Composite
dropped 102.385 points or 2.42 percent, to 4,135.355.
Bond prices rose, with the 5-year up 12/32 in
price to yield 1.7055 percent. The benchmark 10-year U.S.
Treasury note rose 17/32 in price to yield 2.7261
"This (jobs) number doesn't give any reason to move up the
Fed timing of rate hikes, which is what was feared most," said
The FTSEurofirst 300 index closed up 0.56 percent at
The dollar was choppy against the euro and declined against
other major currencies despite the solid U.S. jobs gains.
The jobs report will likely encourage the Fed to continue
reducing, or tapering, its massive monetary stimulus, according
"It's a Goldilocks report, not too warm and not too cold,
and puts pressure on the next report in May to be good," Valeri
said. "It doesn't change the pace of tapering and shows the
economy is still on track."
The greenback was up 0.17 percent against the euro at
$1.3695. It fell 0.51 percent to 103.38 against the Japanese yen
after hitting a session high of 104.12 yen in trading
immediately after the employment report.
Brent crude rose above $106 a barrel as expectations of a
deal to reopen vital Libyan oil ports were offset by doubts that
a lasting resolution was imminent.
Brent crude settled up 57 cents at $106.15 a barrel.
U.S. crude, or West Texas Intermediate, rose 85 cents to
settle at $101.14 a barrel.
(Reporting by Herbert Lash; additional reporting by Marc Jones
in London; Editing by Bernadette Baum, Meredith Mazzilli and Dan