(Bloomberg) — Global stocks were on track to hold record highs hit on Thursday as traders focused on U.S. jobs data due Friday for clues about Federal Reserve rate cuts.
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Tokyo’s Topix index hit another record high, before falling. The moves followed gains in European stocks, led by French ones. U.S. stock futures were little changed in Asia after markets were closed on Thursday for a holiday.
A gauge of global stocks was on track for its longest weekly winning streak since March. The moves have been boosted by a string of weak U.S. economic data that has revived hopes for a rate cut in September. Emerging market stocks also benefited, with the MSCI emerging markets index rising to the highest level in two years on Thursday.
“Markets are expecting U.S. employment to either show a slight slowdown or stability,” said Marco Oviedo, investment strategist at XP Investimentos in Sao Paulo. “Any sign that the economy is cooling faster could be very positive for emerging currencies.”
The dollar strength index steadied on Friday after falling for a third straight day as developing-nation currencies rose broadly, led by the Brazilian real. The pound was little changed after a strengthening streak that began last week as investors digested the prospect of a Labor Party victory in Thursday’s general election.
Exit poll data showed Keir Starmer’s Labour Party was projected to win with a large majority, while Rishi Sunak’s ruling Conservatives were on track for their worst ever performance and would likely see some of the party’s biggest names expelled from parliament.
France’s benchmark CAC 40 index advanced for a second straight day ahead of the final round of voting in this weekend’s snap parliamentary elections. The gauge extended gains as polls suggested Marine Le Pen’s National Rally and its allies will fall short of a majority.
In Asia, Australian and New Zealand bond yields were little changed on Friday morning. The yen was also stable after appreciating slightly in a rebound from the lowest level since 1986 reached on Wednesday.
Data due out in the region on Friday include inflation in the Philippines, Thailand and Taiwan.
Soft economic data
Reports on Wednesday showed the U.S. services sector contracted at the fastest pace in four years, while the labor market saw further signs of weakening ahead of key employment figures on Friday.
“The ISM services fell yesterday to 48.8, the lowest level since the pandemic, and jobless claims deteriorated; ultimately, negative data is being seen as positive for markets,” said Justin Onuekwusi, chief investment officer at St James Place. “It seems like September is the date everyone is thinking about now.”
The price of West Texas Intermediate crude oil rose slightly on Friday morning. Bitcoin fell and traded at around $57,800.
Key events of this week:
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Eurozone retail sales, Friday
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US employment report, Friday
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John Williams of the Federal Reserve speaks on Friday
Some of the main movements in the markets:
Stocks
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S&P 500 futures were little changed as of 9:07 a.m. Tokyo time.
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Hang Seng futures little changed
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Japan’s Topix barely changed
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Australia’s S&P/ASX 200 index fell 0.2%
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Euro Stoxx 50 futures up 0.4%
Coins
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Bloomberg Dollar Spot Index little changed
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The euro remained virtually unchanged at $1.0813.
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The Japanese yen was unchanged at 161.32 per dollar.
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The offshore yuan was unchanged at 7.2926 per dollar.
CRYPTOCURRENCIES
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Bitcoin fell 2% to $57,137.98
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Ether fell 2.7% to $3,058.45
Captivity
Raw Materials
This story was produced with assistance from Bloomberg Automation.
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