A SURPRISINGLY strong payrolls report in the United States on Friday failed to entice investors into stocks even as equities appeared oversold globally following a near 5 percent drop to start the year.

    Brent crude oil extended its weekly slide to more than 10 percent, pressured by unrelenting oversupply and a bleak demand outlook. U.S. crude recorded its largest weekly drop in more than a year.

    Stocks had opened higher on Wall Street after data showed the economy created many more jobs than expected in December and previous months were revised higher.

    But the S&P 500 hit its session high, up 0.9 percent on the day, within five minutes of the open and steadily lost ground since.

    “The market’s reaction (to the jobs report) is something between curious and concerning,” said Richard Scalone, co-head of foreign exchange at TJM Brokerage in Chicago.

    Investors fear that China is growing more slowly than expected and could further weigh on commodity prices and global economic growth.

    The Dow Jones industrial average fell 31.61 points, or 0.19 percent, to 16,482.49, the S&P 500 lost 4.25 points, or 0.22 percent, to 1,938.84 and the NASDAQ Composite dropped 10.64 points, or 0.23 percent, to 4,678.79.

    Stocks and other risk assets got support from Asian markets after China nudged the yuan higher for the first time in nine days, easing fears that it had lost control of the currency, and as the Chinese stock benchmark rose 2 percent.

    Europe initially followed suit, but the pan-European FTSEurofirst 300 index was down 1.3 percent going into the close of trading.

    MSCI’s broadest gauge of stocks globally was little changed on the day and fell more than 5 percent last week, the most since September 2011.

    “What’s going to come out of China is a short-term concern for the market, so maybe the 5 percent decline we’ve seen is not quite enough,” said Andrew Slimmon, a Chicago-based portfolio manager at Morgan Stanley Investment Management, which manages more than US$400 billion in assets.

    “But what’s most important is the payroll numbers coming out today highlight that the economy in the United States has not in any way derailed.”

    He said concerns are only near-term and the beginning of earnings season will “remind investors that the U.S. micro story hasn’t changed.”

    U.S. 10-year Treasury notes were up 5/32 in price to yield 2.1367 percent Friday, from 2.153 percent late Thursday.

    The dollar climbed on measures taken by China to ease last week’s market turmoil and on the payrolls data in the United States, but gains were limited by worries over whether the Chinese Government has done enough to calm its battered stock market.

    The euro was down 0.3 percent against the dollar at US$1.09 while the greenback was little changed versus the yen at 117.61.

    Spot gold fell for the first time last week but was on track to post its largest weekly percentage gain since August.

    (SD-Agencies)