European stocks rebound Friday, but finish the week lower

As London and European traders head home, the major European indices are closing higher on the day. However, the Friday gains were not enough to erase the weekly declines. Germany’s DAX held up best over the five trading days, while Spain’s Ibex led the losses.

The closing levels and changes show:

• German DAX: 25,222.05, up 282.69 points or 1.13%. For the week, down 0.73%.

• France CAC: 7,897.20, up 61.88 points or 0.79%. For the week, down 2.24%.

• UK FTSE 100: 10,461.94, up 33.68 points or 0.32%. For the week, down 2.18%.

• Spain Ibex: 19,085.31, up 80.01 points or 0.42%. For the week, down 3.12%.

• Italy FTSE MIB: 50,483.22, up 245.36 points or 0.49%. For the week, down 2.67%.

European yields fall today, with a mixed weekly picture

European benchmark 10-year yields moved lower across the board today. Germany also led the weekly decline, but French and Italian yields finished higher for the week despite today’s retreat.

• Germany: 3.460%, down 6.9 basis points today and 14.6 basis points for the week.

• France: 4.861%, down 7.4 basis points today, but up 2.7 basis points for the week.

• UK: 5.368%, down 2.4 basis points today and 6.8 basis points for the week.

• Spain: 4.092%, down 5.8 basis points today and 1.2 basis points for the week.

• Italy: 4.616%, down 7.8 basis points today, but up 2.2 basis points for the week.

The weekly moves widened the French and Italian yield spreads versus Germany, as German bonds outperformed.

U.S. payroll growth slows, but Treasury yields reverse higher

The September U.S. employment report showed nonfarm payrolls rising by just 29,000, while the unemployment rate was little changed at 4.2%. Employment across the major industries changed little, pointing to subdued hiring rather than a broad acceleration in job creation.

For stocks, the initial interpretation was that softer hiring could reduce pressure on the Fed to raise rates further. However, the bond market’s early rally did not hold. Treasury yields moved lower after the report before reversing back higher on the day.

The U.S. 10-year yield is now near 5.264%, up approximately 3.0 basis points today and 9.5 basis points for the week.

The Treasury curve shows:

• 2-year: 4.827%, up 4.0 basis points.

• 5-year: 5.046%, up 4.1 basis points.

• 10-year: 5.264%, up 3.0 basis points.

• 30-year: 5.620%, up 1.7 basis points.

That reversal is worth watching. The jobs report showed limited hiring, but buyers could not sustain the move toward lower yields.

U.S. stocks remain higher

U.S. equities are holding gains as Europe closes, with the Nasdaq indices leading the major averages:

• Dow industrial average: 51,081.10, up 148.99 points or 0.29%.

• S&P 500: 7,716.60, up 50.14 points or 0.65%.

• Nasdaq Composite: 27,177.18, up 305.59 points or 1.14%.

• Nasdaq 100: 30,822.41, up 320.85 points or 1.05%.

• Russell 2000: 2,837.00, up 30.38 points or 1.08%.

The USD is mixed. It is lower versus the EUR, GBP, AUD and NZD, but higher versus the JPY, CHF and CAD.

Oil falls on reserve-release news, but the break lower fails

Oil prices moved sharply lower following announcements of planned crude and diesel stockpile releases. G7 leaders confirmed a release of up to 100 million barrels, while President Trump said Europe’s diesel release would begin immediately.

However, prices are off their lows. The crude oil futures snapshot shows a price near $90.70, down $2.17 or 2.34%.

Technically, the move below the floor at $88.72 failed. Sellers had their shot to keep the price below that level, but could not sustain the break. The recovery above it gives buyers some breathing room and makes $88.72 a level to watch again.

Stay above, and buyers have a base from which to build a further recovery. Move back below—and stay below—and sellers would regain control, with the trendline near $87.35 and the 50% midpoint at $86.93 back in focus.

Elsewhere, spot gold is near $4,125.47, down $51.92 or 1.24%, while silver is near $59.69, down 2.06%. Bitcoin is trading near $85,270, up approximately 0.49%.

The lesson from today’s trading is that the initial news reaction needs confirmation from price. Treasury yields initially fell, then reversed higher. Oil broke support, then recovered above it. For traders, whether a market can get—and stay—beyond a key level helps define the bias and the risk.