Stock Exchanges Mixed ahead of US Jobs Data
STOCK EXCHANGES – Stock markets were mixed around the world, with investors awaiting US jobs data and Asia seeing thinned holiday trading. Meanwhile, Europe expects to open higher.
In Asia, markets remained in tight ranges due to low-volume trading sessions amid a holiday. Hong Kong stocks gained 0.4 percent, Korea’s KOSPI lost 0.5 percent, Australian markets jumped 0.1 percent, and New Zealand markets slipped 0.3 percent.
China and Japan are set to continue trading on Monday and Tuesday, respectively.
In Europe, stocks are expected to kick off the trading session on a high note. In London, the FTSE futures were 0.2 percent higher. In Germany, the DAX futures were 0.1 percent higher.
On the flipside, Wall Street stocks closed the previous session lower, with losses in the Oil & Gas, Basic Materials, and Technology sectors leading the drop.
The Dow Jones Industrial Average shed 0.46 percent. The S&P 500 index dropped 0.21 percent, while the NASDAQ Composite Index declined 0.16 percent.
The CBOE Volatility index that measures the S&P 500 options’ implied volatility lost 2.57 percent, reaching 14.42.
Energy shares were down due to plummeting oil prices after US crude production output set a new record. However, the losses were limited by the worsening political crisis in Venezuela as well as the stopping of oil sanction waivers by the US.
Economic Data and Other Markets
Investors are on standby for the US employment figures scheduled for later in the day. The median forecast was 185,000 net new jobs for April, with unemployment rate around 3.8 percent.
A robust official data would solidify the belief that the world’s biggest economy is on its way to the longest growth ever. This would also strengthen the dollar and the outlook for corporate earnings.
“There’ll be more than one eye on what the report says about average earnings growth that’s expected to grow a meager 0.1 percent,” said an economist at National Australia Bank.
Global stocks have strengthened so far this year, with the S&P 500 climbing over 16 percent. However, further gains will be difficult to attain, according to analysts at Capital Economics.
“Investors are still too optimistic about the outlook for earnings growth. As earnings disappoint, we think that stock markets will drop around the world,” they said.
Meanwhile, in the currency markets, the Aussie and kiwi weakened in the early trade, with speculators betting that both currencies will see interest rate cuts by next week.
The Australian dollar declined below the $0.7000 level, touching its lowest since early January. The kiwi dollar slid closer to a five-month trough of $0.6581.
On the other hand, the dollar index was last seen at 97.842, closing in toward a two-year peak of 98.33 hit last week.