Global markets fall after weak U.S. employment figures

World stock markets have dropped on new US employment figures, seen as crucial in determining whether the Federal Reserve will raise interest rates this month. The non-farm payrolls report, released on the first Friday of every month, showed the US economy added 173,000 net new jobs in August - below expectations. However, the Labor Department stressed August figures are traditionally revised sharply upwards because of weak reporting during the summer holidays.

With this jobs report … the Fed finds itself in a real uncertainty jam when it comes to a September interest rate hike.

Mohamed El-Erian, chief economic adviser at Allianz, in Newport Beach, Calif.

The jobless rate fell to 5.1% - its lowest level since April 2008. Average weekly earnings rose by a stronger-than-forecast 0.3%. U.S. stocks closed 1.7% lower in the wake of the figures, as they were seen as supporting the possibility of a rate rise in two weeks’ time when the Fed next meets. Markets also dropped in Europe, with Britain’s FTSE 100 closing down 151.18 points, or 2.4%, at 6,042.92 - leaving it down 3.3% for the week.

Business jobs report