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Premarket: Stock futures dive on stunningly weak U.S. jobs report

North American markets are headed for a rough start after the U.S. jobs report came in much weaker than expected, with triple-digit losses likely in the major U.S. and Canadian indexes.

Economically sensitive commodities, including crude oil and copper, also dove on the soft jobs report -- and gold rallied as traders ran to the haven asset for cover.

The Canadian jobs report, issued at the same time, was also surprisingly weak, sending the loonie into a tailspin. It lost nearly a full cent on this morning's economic data.

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The U.S. created just 88,000 jobs in March, far from the 180,000 that economists had forecast, although the unemployment rate dipped to 7.6 per cent. It was the smallest gain in jobs in nine months, and more people dropped out of the labour force. It was the most significant evidence to date that the rate of hiring in the U.S. is slowing, and suggested austerity measures in the U.S. - especially the sequester-related spending cuts - could be taking their toll.

Some economists have been scaling back their forecasts for March job growth in recent days, but even many of the more pessimistic were expecting a better reading.

In Europe this morning, traders have another concern: Retail sales for the euro zone fell 0.3 per cent in February from the previous month. Airline stocks took a particularly harsh beating, as investors worried that an outbreak of bird flu in China could cut into travel demand. A new strain of the bird flu has so far caused six deaths.

In Asia overnight, the Nikkei surged to a 4.5-year high, extending gains from Thursday after the Bank of Japan unleashed $1.4-trillion in stimulus. Other indexes, especially the Hang Seng, ended lower, as traders cut their equity exposure ahead of this morning's U.S. jobs report.

Now, here's a closer look at what is going on this morning.



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U.S. futures: S&P 500 -1.0 per cent; Dow -0.9 per cent; Nasdaq -1.0 per cent

Hong Kong's Hang Seng index -2.73 per cent

Shanghai composite index -0.12 per cent

Japan's Nikkei +1.58 per cent

London's FTSE 100 -1.26 per cent

Germany's DAX -1.59 per cent

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France's CAC 40 -1.43 per cent

Italy's FTSE MIB +0.22 per cent


WTI (Nymex May) -1.27 per cent at $92.08 (U.S.) a barrel

Gold (Comex Jun) +1.15 per cent at $1,570.20 (U.S.) an ounce

Copper (Comex May) -0.54 per cent at $3.33 (U.S.) a pound


Canadian dollar down 0.0086, or 0.87 per cent, at $0.9789 (U.S.)


The U.S. Labour Department said nonfarm payrolls rose 88,000 last month, versus the 190,000 that was expected.

The U.S. Commerce Department said the nation's trade deficit narrowed 3.4 per cent in February to $43.0-billion from $44.5-billion in January. Economists expected the deficit to widen to $45.0-billion. Crude oil imports fell to their lowest level since March 1996.

Statistics Canada said the country lost 55,000 jobs in March, as the jobless rate climbed back to 7.2 per cent.

Statscan said the merchandise trade deficit in February widened to $1-billion. Economists expected no change.


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The premarket report is constantly updated to reflect the latest news developments and market moves. For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities

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About the Author
Investment Editor

Darcy Keith is The Globe and Mail's Investment Editor. He has been a business journalist since 1992 and joined the Report on Business in 2010 from Yahoo! Canada, where he was the senior editor of finance. More


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