Futures rebounded, erasing their early losses Friday following a stronger-than-expected monthly government payrolls report.
The monthly non-farm payrolls number grew more than expected in September, jumping 103,000 in September, but the unemployment rate remained steady at 9.1 percent, according to the Labor Department. Economists polled by Reuters expected a total of 60,000 jobs to have been created.
"The knee-jerk reaction will be positive, but it'll be difficult to spin this number as the start of an improving trend and reassure Americans the worse is behind us," said Todd Schoenberger, managing principal of The BlackBay Group.
"The numbers may have beaten consensus but remain horrific and shouldn't be a tremendous surprise to Americans considering the troubling economic environment and a focus by companies to do whatever it takes to turn a profit," Schoenberger added.
Meanwhile,Moody’s downgraded 12 UK financial institutions, saying it sees a decreased likelihood of government support for smaller institutions in particular but specifying the move does not reflect a deterioration in the financial strength of the banking system.
The downgrade follows Thursday’s announcement by the Bank of England’s Monetary Policy Committee that the Bank would buy $116.25 billion worth of government bonds—a process known a quantitative easing—surprising the markets which had expected the Bank to take no action until November.
“This is the most serious financial crisis we’ve seen at least since the Great Depression,” BoE governor Sir Mervyn King warned. “We’re having to deal with very unusual circumstances, and to act calmly and do the right thing. The right thing at present is to create some more money to inject into the economy.”
Meanwhile the ECB offered new emergency loans to banks to help them through the turmoil of the continent's debt crisis—but decided against an interest rate cut despite mounting fears of another recession. ECB President Jean-Claude Trichet did not even indicate that a rate cut was possible at the next month's meeting.