LONDON, March 7 (Reuters) - U.S. stock futures moved higher and the dollar extended its losses against the yen and euro on Friday after data showed the U.S. economy created fewer jobs than expected last month, bolstering bets the Federal Reserve will cut interest rates this year.
Nonfarm payrolls increased by 151,000 jobs in February, according to the closely watched employment report, with unemployment edging up. The report, the first under President Donald Trump's watch, came at the end of a week marked by confusion over U.S. trade policy and a global rise in borrowing costs.
U.S. stock futures regained some lost ground on the data, with Wall Street stocks suffering a buffeting this week from a darkening outlook for U.S. growth and uncertainty over President Donald Trump's tariff policies.
Nasdaq futures and S&P 500 futures rose 0.3% and 0.4%, respectively after the data. Wall Street had fallen on Thursday with the
Nasdaq (.IXIC), opens new tab confirming a correction - defined as a fall of at least 10% - since peaking in December.
The euro, on track for its best week since 2009, added to gains, rising 0.8% to $1.0876.
The dollar, meanwhile, dropped 0.5% against the yen to 147.29 , from 147.62 yen before the data.
"The market is back to pricing in three rate cuts in 2025, but I wouldn’t bank on the Fed sending any dovish signals anytime soon," said Brian Jacobsen, chief economist at Annex Wealth Management.
"With the unemployment rate at 4.1% and inflation still above target, they have no reason to change their messaging yet."
Stocks in Europe and Asia struggled for buoyancy and a steep selloff in bonds abated, after a week marked by confusion over U.S. trade policy and by the global rise in borrowing costs.
European stocks (.STOXX), were down 0.7%, recovering some earlier losses but still on track for a first weekly drop after 10 straight weeks of gains. Luxury stocks and retailers (.SXRP), weighed heavily.
The selloff in euro zone government bond markets triggered by Germany's plans for a huge spending package slowed. After the biggest two-day fall in Bunds since the 1970s, the benchmark 10-year bond yield , which moves inversely to prices, fell to 2.82%.
Investors were a speech from Federal Reserve Chair Jerome Powell later in the day, which could provide more clarity on the outlook for interest rates in the world's biggest economy.
Trump on Thursday suspended tariffs of 25% he had imposed this week on most goods from Canada and Mexico, the latest twist in a fluctuating trade policy that has whipsawed markets and stoked concerns over growth and inflation.
"With this being a delay rather than a lasting exemption and with reciprocal tariffs also expected to be announced after April 2, this leaves plenty of lingering tariff uncertainty," Deutsche Bank analysts wrote.
For most of the global trading day, a "risk-off" mood had persisted.
Risk-sensitive bitcoin fell a smidgeon to $89,199. Trump signed an executive order on Thursday to establish a so-called strategic bitcoin reserve, built using tokens already owned by the U.S. government that were forfeited during criminal or civil asset forfeiture proceedings.
Reporting by Tom Wilson in London, Rae Wee in Singapore and Chuck Mikolajczak in New York; Editing by Susan Fenton, Alex Richardson and Hugh Lawson
