GLOBAL MARKETS-Stocks fall as Nasdaq slides; dollar eases on jobs data

Reuters - UK Focus

* Wall St touches record high, then retreats on Nasdaq slide

* Dollar slips as solid US jobs data suggests less stimulus

* Brent rises from five-month low to above $106

* Bond yields dip after data eases fears of early rate hike

(Adds close of U.S. markets)

By Herbert Lash

NEW YORK (Frankfurt: HX6.F - news) , April 4 (Reuters) - A slide in biotech stocks

pulled Wall Street and a measure of global equities lower on

Friday despite a solid U.S. jobs report that weakened the dollar

on views that the Federal Reserve will keep scaling back its

stimulus.

The U.S. bond market, surprisingly, rallied, particularly

five-year Treasury notes, which had been weak lately on fears

the Fed could raise interest rates earlier than anticipated.

The FTSEurofirst 300 index of European shares

touched a peak last seen in 2008 on the U.S. jobs data and

closed higher, for a ninth straight gain and marking the third

consecutive week of higher closes.

But stocks on Wall Street retreated after stabilizing

earlier in the week as momentum stocks such as biotechs fell for

a second straight session. The Nasdaq biotech index lost

4.01 percent, and the Nasdaq composite fell 2.6 percent in its

worse single-day loss in two months.

The decline pulled down U.S. stocks and global equities.

"You've got some big names in there. There is a high

correlation inside of those groups," said Keith Bliss, senior

vice president at Cuttone & Co in New York. "Managers tend to

trade the entire group as opposed to individual names. So that

of course, is hitting the Nasdaq and everybody else."

Equities had opened higher on optimism spurred by the U.S.

nonfarm payrolls report, which a gain of 192,000 jobs in March,

just shy of the 200,000 forecast, after rising 197,000 in

February. The unemployment rate was unchanged at 6.7 percent.

With a solid pace of hiring for a second month, the U.S.

economy appears to be recovering from a winter slowdown.

A smaller survey of households, from which the unemployment

rate is derived, showed a much bigger surge in employment. That

jump was met by a rise in the number of people entering the

labor force, a show of confidence in the U.S. job market.

The percentage of working-age Americans with a job reached

its highest level since the summer of 2009.

"I'm surprised by the overall weakness today, but since it

is concentrated in names that have been weak, I think it is just

a continuation of that. I'm not concerned about this spilling

over to the broader market," said David Joy, chief market

strategist at Ameriprise Financial in Boston, where he helps

oversee $703 billion in assets under management.

"We've been in a trading range, finding resistance at record

levels, so this isn't cause for alarm. The data is getting

stronger, which suggests we have an opportunity to move higher

with participation from other groups," Joy said.

The S&P 500 hit a record high before retreating. MSCI (NYSE: MSCI - news) 's

all-country world stock index fell 0.45 percent.

The Dow Jones industrial average fell 159.84 points,

or 0.96 percent, to 16,412.71. The S&P 500 lost 23.68

points, or 1.25 percent, to 1,865.09, and the Nasdaq Composite

dropped 110.014 points, or 2.6 percent, to 4,127.726.

For the week, the Dow rose 0.6 percent, the S&P gained 0.4

percent, and the Nasdaq fell 0.7 percent.

Bond prices rose, with the five-year up 13/32 in

price to yield 1.7022 percent. The benchmark 10-year U.S.

Treasury note rose 17/32 in price to yield 2.7261

percent.

"This (jobs) number doesn't give any reason to move up the

Fed timing of rate hikes, which is what was feared most," said

John Briggs, U.S. rates strategist at RBS (LSE: RBS.L - news) in Stamford,

Connecticut.

The FTSEurofirst 300 index closed up 0.56 percent

at 1,352.78.

The dollar was choppy against the euro and declined against

other major currencies despite the U.S. jobs gains.

"It's a Goldilocks report, not too warm and not too cold,

and puts pressure on the next report in May to be good," Anthony

Valeri, investment strategist at LPL Financial (NasdaqGS: LPLA - news) in San Diego,

said. "It doesn't change the pace of tapering and shows the

economy is still on track."

The greenback was up 0.14 percent against the euro at

$1.3695. It fell 0.66 percent to 103.22 against the Japanese yen

after hitting a session high of 104.12 yen in trading

immediately after the employment report.

Brent crude rose above $106 a barrel as expectations of a

deal to reopen vital Libyan oil ports were offset by doubts that

a lasting resolution was imminent.

Brent crude settled up 57 cents at $106.15 a barrel.

U.S. crude, or West Texas Intermediate, rose 85 cents to

settle at $101.14 a barrel.

(Reporting by Herbert Lash; additional reporting by Marc Jones

in London; Editing by Bernadette Baum, Meredith Mazzilli, Dan

Grebler and Leslie Adler)

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