US open: Stocks bolstered by trade talks and solid March jobs report
US stocks opened higher on Friday as investors welcomed progress in Sino-US trade talks and a better than expected non-farm payrolls report.
At 1520 BST, the Dow Jones Industrial Average was up 0.20% at 26,436.18, while the S&P 500 had gained 0.41% at 2,891.12 and the Nasdaq traded 0.53% firmer at 7,933.92.
The Dow opened 51 points higher as market participants digested comments from Donald Trump, who said on Thursday after a meeting with Chinese vice Premier Liu He that a trade deal between the two nations was about four weeks away, with some sticking points remaining.
Trump said the two sides had agreed "a lot of the most difficult points" but still had some way to go.
On Friday, he reiterated those comments, reportedly saying he did not want to preict that a deal with China would be reached.
"Confidence is reaching new levels that a trade deal will eventually be signed after many months of protracted negotiations," said FXTM research analyst Lukman Otunuga.
"We believe that once the US-China trade deal is eventually announced, that could release pent-up demand and trigger a knee-jerk jump in risk-on assets. However, whether such gains are sustained depends on how markets interpret the technicalities of the deal, and what it means for a slowing global economy. As the saying goes, the devil is in the details."
On the macro front, all eyes were on the release of the non-farm payrolls report, unemployment rate and average earnings.
Friday's report revealed that US job growth returned to trend last month as some of the erratic factors that depressed the previous month's reading washed out of the data, but the latest wage data fell short of forecasts.
According to the Department of Labor, non-farm payrolls grew by 196,000 during the month of March following an initially reported increase of 20,000 in February, alongside a combined upwards revision for the previous two months of 14,000.
Average hourly earnings fell short of forecasts, increasing by 0.1% month-on-month (consensus: 0.3%), pushing the year-on-year rate of increase down from 3.4% to 3.2% (consensus: 3.3%).
The labour force participation rate also eased, slipping by two-tenths of a percentage point to 63.0% as the civilian labour force and employment shrank by 224,000 and 201,000, respectively.
Nonetheless, as Mickey Levy at Berenberg Capital Markets pointed out that, when adjusted for inflation, the rate of increase in earnings was likely above 1.0%, which he said was "good news for consumption".
Unemployment printed at 3.8% for March, as expected by the consensus and was unchanged versus the month before. For the first quarter as a whole the rate of joblessness ticked higher from 3.8% over the previous three-month stretch to 3.9%.
"But this was due to the partial government shutdown. We expect the unemployment rate to resume its decline going forward, albeit at a slower pace than recent years," said Levy.
Following the report, Donald Trump called on the Federal Reserve to lower interest rates and switch from quantitative tightening to quantitative easing.
Trump, who was on his way to the US-Mexico border has previously taken aim at the Fed for being too aggressive in raising rates and on winding down its balance sheet.
In corporate news, Hibbett Sports shares dipped 0.98% following an announcement that CFO Scott Bowman will stand down after almost seven years in the role and Intel shares fell 1.56% on the back of a downgrade at Wells Fargo.
Elsewhere, shares of streaming service Spotify were gaining 2.12% in early trade after analysts at Baird upped their target price on the stock.