Esa Ramasamy, executive editor at Platts, said the incredible momentum in the oil market isn't likely to be derailed. Nymex crude is up $1.39 to $125.08 after hitting a record $126.20 at 9:27 a.m. EDT.

"Demand must fall off very rapidly and inventories must rise rapidly or oil is going to keep on going," Ramasamy said.

The Canadian economy added 19,200 new jobs in April, with construction and hospitality industries leading the way, according to the monthly Labour Force Survey released by Statistics Canada. Despite the rise in employment, the addition of 23,800 people to the labour force during the month was enough to nudge up the unemployment rate to 6.1% from 6% a month earlier. Analysts were expecting to see 10,000 new jobs in April with the jobless rate holding steady at its March level.

The news pushed the Canadian dollar higher against major currencies but the loonie failed to cross parity with the greenback, reaching an intraday high of 0.9950.

Yields on two-year Canadian government bonds are down 3.8 bps to 2.73%, with five-year yields down 6.6 bps to 3.13%, 10-year yields down 5.5 bps to 3.59% and 30-year yields down 5.0 bps to 4.09%. The Canadian 10-year note is yielding 15.76 bps less than the U.S. 10-year note.

U.S. two-year yields are down 1.6 bps to 2.20%, with five-year yields down 2.7 bps to 2.94%, 10-year yields down 2.8 bps to 3.75% and 30-year yields down 3.5 bps to 4.51%. The Eurodollar September 08 contract is down 2.0 ticks to 97.39. The 10/2 year spread flattened 0.99 bps to 154.13. The yield curve is flatter, with the 10/2-year spread down 1.0 bps to 154.13 bps.

In Germany, returns on two-year German bonds are down 4.8 bps to 3.70%, with five-year yields down 6.0 bps to 3.75%, 10-year yields down 7.2 bps to 3.99% and 30-year yields down 4.5 bps to 4.51%.

Yields on UK two-year bonds are down 1.5 bps to 4.31%, with five-year yields down 2.2 bps to 4.27%, 10-year yields down 3.2 bps to 4.58% and 30-year yields down 1.8 bps to 4.46%.

Toronto's S&P/TSX composite index is down 92.44 points to 14515.55, the Dow Jones industrial average down 139.14 points to 12727.64, the S&P 500 down 12.21 points to 1385.47 and the Nasdaq down 11.79 points to 2439.45.

European stock markets closed with the Eurostoxx down 47.30 points to 3228.33, the UK FTSE 100 down 66.10 points to 6204.70 and the German DAX down 68.73 points to 7003.17.

The euro is up 0.0068 to 1.5462 against the USD, up 0.0091 to 1.5566 against the Canadian dollar and lower by 0.42 at 159.25 against the yen.

Against the U.S. dollar, the Canadian dollar is up 0.0101 to 0.9934 and the Australian dollar is lower by 0.0017 to 0.9419.

The U.S. dollar is down 0.76 to 102.99 against the yen and the pound is down 0.0044 to 1.9499 USD.

The Canadian dollar is up 0.30 to 102.30 against the yen. The pound is lower by 0.0245 to 1.9629 against the loonie.

The U.S. Dollar Index was down 0.3680 to 73.1090.

WTI crude oil is up $1.95 to $125.64. The front month gold contract at the Chicago Board of Trade is up $5.60 to $887.50.

All data taken at 1:22 p.m. EDT.

By Adam Button, This email address is being protected from spam bots, you need Javascript enabled to view it , edited by Cristina Markham, This email address is being protected from spam bots, you need Javascript enabled to view it