US open: Equities gain as non-farm payrolls rise, unemployment rate falls

US equities advanced at the opening bell on Friday after non-farm payrolls rose broadly in line with expectations.

Employers added 223,000 jobs in April, compared with a consensus forecast for an increase of 220,000. The unemployment rate was bang in line with estimates, falling to 5.4% last month from 5.5% in March.

“The return to more normal jobs growth in April will relieve Fed policy makers, providing tentative evidence that the Q1 economic weakness was mostly a blip,” said Christian Schulz, senior economist at Berenberg.

“Falling unemployment points to a continuing erosion of slack in the economy, which warrants policy rate normalisation rather sooner than later. Weak wage growth and headline inflation rates around zero still allow the Fed some time, but today’s release has kept chances for a September rate hike alive, especially if other indicators such as the ISM rebound as well.”

The US 10-year Treasury yield fell seven basis points to 2.11% following the report.

At 14:00 London time US wholesale inventories data for March will be released with analysts’ predicting a 0.3% increase.

In China, data showed exports and imports fell in April, fuelling hopes of further stimulus. “Trade data from China overnight was pretty horrible with exports and imports plunging again over the year, Asian equities responded well on the prospect for further government stimulus but the data doesn’t bode well for world growth,” said Jasper Lawler, market analyst at CMC Markets.

Among corporate stocks, AOL jumped after its first quarter results impressed investors. It reported a better-than-expected 7.2% increase in revenue amid stronger advertising.

McDonald’s was a high riser after reporting April sales that beat analysts’ projections , supported by a slower decline at its US business.

West Texas Intermediate fell 0.25% to $64.75 per barrel at 14:50, ICE data showed.