US stocks gain on weak employment

US stocks managed to end with a gain in its first full trading week for 2014. The S&P 500 rose 0.2 percent on Friday to end the week up 0.6 percent.

The rise in stocks was driven by lowered expectations for the Federal Reserve to reduce its monetary stimulus after a surprisingly weak employment report on Friday. US non-farm payrolls rose just 74,000 in December, the smallest gain since January 2011.

The unemployment rate did decline to 6.7 percent, the lowest since October 2008, but mainly because more people left the labour force.

The weak employment growth in December was partly attributed to weather. Figures based on the household survey showed 273,000 Americans were not at work because of weather during the survey week.

Economic data from the UK on Friday were also disappointing. Construction output shrank 4.0 percent in November while industrial production was flat in December. Data from the British Retail Consortium showed that retail sales grew 1.8 percent in December, down from 2.3 percent in November.

Nevertheless, the National Institute of Economic and Social Research said on Friday that the UK economy grew by 0.7 percent in the last three months of 2013. That was slower than the 0.8 percent growth in the third quarter but still left growth for the full year at 1.9 percent, the fastest since 2007.

Earlier on Friday, China reported that its annual trade in goods passed the $4 trillion mark for the first time in 2013. Exports had increased 4.3 percent in December while imports rose 8.3 percent.

In Japan, data on Friday showed that the leading index rose to 110.8 in November from 109.8 in October while the coincident index rose to 110.5 from 110.4.