* US Feb payrolls rise; jobless rate lowest since April 09
* U.S. stocks, world stocks fall on oil gains
* U.S. dollar fails to benefit from jobs data
(Updates prices)
By Caroline Valetkevitch
NEW YORK, March 4 (Reuters) - World stocks and the U.S.
dollar dropped on Friday as oil prices rose on escalating
tensions in Libya, offsetting a U.S. jobs report that
reinforced views the economic recovery is becoming
self-sustaining.
Gold advanced above $1,430 an ounce and U.S. Treasury debt
prices gained as the Libyan turmoil drove investors to seek
safe-haven assets.
U.S. crude oil prices jumped to their highest since
September 2008, and Brent crude rose above $116 as Libyan
security forces clashed with rebels near the major oil terminal
of Ras Lanuf.
The MSCI all-country world stock index <.MIWD00000PUS> was
down 0.08 percent, reversing earlier gains. On Wall Street
stocks fell a day after posting their best one-day rise in
three months.
"The rise in oil is a concern," said Kim Caughey Forrest,
senior equity research analyst at Fort Pitt Capital Group in
Pittsburgh. "Businesses will absorb it or pass it along, and if
they do, eventually the consumer has to pay more."
The U.S. government's monthly payrolls report showed strong
jobs growth in February, but with the market having rallied on
Thursday on expectations of solid hiring by private employers
the data had a muted impact.
The Labor Department reported hiring by U.S. employers in
February hit the highest level since last May, and the
unemployment rate fell to 8.9 percent, an almost two-year low.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
U.S. payrolls jump, jobless rate near 2-year low
[]
INSTANTVIEW: []
SNAP ANALYSIS: U.S. jobs data showing some consistency
[]
Reuters Insider-Strong Payrolls Data Puts Focus on Fed's QE
http://link.reuters.com/mub48r
Graphic- US payrolls:
http://r.reuters.com/rud48r
Graphic- US unemployment:
http://r.reuters.com/kud48r
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
The Dow Jones industrial average <> dropped 140.24
points, or 1.14 percent, to 12,117.96. The Standard & Poor's
500 Index <.SPX> fell 15.25 points, or 1.15 percent, to
1,315.72. The Nasdaq Composite Index <> lost 23.73 points,
or 0.85 percent, to 2,775.01.
The U.S. employment data did little to alter expectations
that the Federal Reserve would maintain its loose monetary
policy, driving down the dollar to a four-month low against a
basket of major currencies.
The euro rose above the key psychological $1.40 mark and
headed for its biggest weekly rise in six weeks. The single
currency is on course to make a run toward $1.4283, a key
resistance level reached last November, after European Central
Bank President Jean-Claude Trichet strongly hinted on Thursday
at an interest rate rise in April.
The U.S. dollar fell as low as 82.25 yen on EBS <JPY=EBS>
and was down against the euro.
"The focus in currency markets will remain on interest rate
differentials, and that's been clearly on an upward trend in
favor of the euro," said Paresh Upadhyaya, head of Americas G10
FX Strategy at BofA Merrill Lynch Global Research in New York.
In the U.S. government debt market the benchmark 10-year
note <US10YT=RR> was up 12/32 in price, its yield easing to
3.52 percent from 3.56 percent late on Thursday.
Brent crude futures <LCOc1> for April delivery were last up
$1.19 at $115.97 a barrel. Brent oil has risen about 15 percent
since the end of January.
"Tension in the Middle East is like a runaway train," said
Michael Hewson, an analyst at CMC Markets. "Once it starts,
it's very difficult to stop. And if there is a danger that it
impacts the supply chain, people will understandably get
nervous."
Investors worry rising oil prices could also affect demand
for industrial metals, including copper.
Three-month copper on the London Metal Exchange <CMCU3> was
$9,926 a tonne, up from a last bid of $9,910 a tonne on
Thursday, but below levels from earlier Friday.
Spot gold <XAU=> prices were higher, and hit a high of
$1,431.20.
In the European stock market, the FTSEurofirst 300 <>
was down 0.7 percent.
(Additional reporting by Rodrigo Campos, Wanfeng Zhou in New
York; and Jeremy Gaunt and Claire Milhench in London; Editing
by Leslie Adler)
