European Shares Seen Opening Up Before Key US Jobs Report
European stocks may open on a positive note Friday after strong U.S. economic data released overnight suggested the world’s largest economy ended 2022 on a solid footing.
Asian markets traded mostly higher as focus shifted to the monthly U.S. jobs report due later in the day that could provide additional clues on how aggressive the Federal Reserve will be in tightening policy.
Economists currently expect U.S. employment to jump by 200,000 jobs in December after an increase of 263,000 jobs in November. The unemployment rate is expected to hold at 3.7 percent.
Traders will also keep an eye on reports on U.S. service sector activity and factory orders for clues to future economic trends.
Closer home, factory orders and retail sales data from Germany along with flash consumer prices, retail sales and economic confidence figures from the euro area are due later in the day, headlining a busy day for the European economic news.
The dollar was little changed near a one-month high, helping gold prices push higher.
U.S. two-year Treasury yields eased a little bit after hitting a more than two-month high of 4.497 percent overnight.
Oil rose over 1 percent to extend gains from Thursday after data showed gasoline and distillate stockpiles dropped in the week ended December 30th.
U.S. stocks fell sharply overnight, as strong ADP private payrolls data and weekly jobless claims figures provided further evidence of a tight labor market and dashed hopes for a change to aggressive Fed policy anytime soon.
Adding to concerns about the economic outlook, Fed members Esther George and James Bullard said that interest rates will stay higher for longer to tame inflation.
The Dow lost 1 percent, the tech-heavy Nasdaq Composite tumbled 1.5 percent and the S&P 500 declined 1.2 percent.
European stocks snapped a three-day winning streak on Thursday after the release of hawkish Fed minutes and disappointing German trade data, with both imports and exports falling in November.
The pan European STOXX 600 slipped 0.2 percent. The German DAX dropped 0.4 percent and France’s CAC 40 index eased 0.2 percent, while the U.K.’s FTSE 100 rose 0.6 percent after upbeat trading statements from Next Plc and B&M European Value Retail.
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