Stocks Surge as Amazon Reports Strong Earnings and US Yields Rise

On Friday, global stock markets experienced a notable rise, largely driven by a significant rally in Amazon.com shares. This surge followed the company's announcement of stronger-than-expected financial results, which provided a boost to investor confidence. In contrast, the benchmark 10-year Treasury yields saw an increase as investors processed a disappointing U.S. jobs report that indicated minimal job growth in October.

Amazon.com shares soared by 6.2 percent after the company released its earnings report late Thursday, which also hinted at promising results for the upcoming holiday quarter. This positive performance from Amazon helped to mitigate a 1.2 percent decline in Apple shares, which faced pressure due to the iPhone maker's cautious growth outlook.

Rick Meckler, a partner at Cherry Lane Investments, commented on the situation, stating, "We've made it most of the way through the Big Tech names, and (results) were probably not as bad as people feared and, in some cases, were pretty good. So investors decided that the little bit of a sell-off we had the last couple of days was unwarranted." This sentiment reflects a broader optimism among investors, despite the mixed signals from the job market.

The U.S. jobs report revealed that the economy added very few jobs in October, a situation exacerbated by industrial actions and hurricanes that disrupted normal employment patterns. However, the unemployment rate remained steady at 4.1 percent, suggesting that the labor market is still relatively stable.

In the wake of the jobs data, Treasury yields initially fell but later rose by 2.5 basis points to 4.309 percent, after dipping to 4.222 percent earlier in the day. This fluctuation indicates that traders are adjusting their expectations regarding future interest rate cuts by the Federal Reserve. Currently, there is a 99 percent probability of a 25-basis-point cut at the Fed's upcoming meeting on November 6-7, an increase from 93 percent prior to the jobs report.

As the U.S. presidential election approaches, polls indicate a tightly contested race between Republican Donald Trump and Democratic Vice President Kamala Harris. With just four days remaining until Election Day, both candidates are nearly tied in several key states, adding an additional layer of uncertainty to the market.

In terms of market performance, the Dow Jones Industrial Average increased by 288.34 points, or 0.69 percent, reaching 42,051.80. The S&P 500 rose by 23.46 points, or 0.41 percent, to 5,728.91, while the Nasdaq Composite climbed 144.77 points, or 0.80 percent, to 18,239.92. Globally, MSCI's stock gauge rose by 4.04 points, or 0.49 percent, to 836.34, and the STOXX 600 index saw a gain of 1.09 percent.

The U.S. dollar experienced some fluctuations as well, paring gains against the euro after the jobs data was released. The dollar index, which measures the greenback against a basket of currencies, was up 0.39 percent at 104.28, while the euro fell by 0.4 percent to $1.0839. Against the Japanese yen, the dollar strengthened by 0.64 percent to 153.

Meanwhile, the U.S. jobs data provided some relief for British government bonds, with the 10-year gilt yield decreasing by 6 basis points to 4.39 percent. Despite this, British bonds are still on track for a weekly rise, driven by concerns over inflation and growth following the new Labour government's budget.

In the commodities market, oil prices continued their upward trend amid reports that Iran is preparing a retaliatory strike on Israel from Iraqi territory. This situation has escalated tensions in the Middle East, particularly in light of ongoing conflicts in Gaza. Brent crude futures rose by 29 cents to settle at $73.10 a barrel, while U.S. West Texas Intermediate (WTI) crude gained 23 cents to settle at $69.49.

The financial markets are currently navigating a complex landscape marked by corporate earnings, economic data, and geopolitical tensions. Investors are advised to stay informed and consider these factors as they make decisions in the coming days. The interplay between economic indicators and market sentiment will be crucial in shaping the investment climate as we approach significant events like the U.S. presidential election.