Softer numbers will provide a short-lived relief for equities
US stocks were mostly positive on the first day of autumn after four sessions of losses as investors shifted focus to the jobs report. The Dow Jones rose nearly 0.5%, the S&P 500 gained 0.3%, while the Nasdaq Composite fell about 0.3%, to post a first five-day losing streak. Still, all of the indices are on track to finish the week lower. In individual stocks, shares of Nvidia lost 7.7% amid reports that the US government is restricting some sales in China.
Asian equities closed mixed on Friday ahead of US jobs data that might reinforce Fed plans for agressive interest rate hikes to cool inflation. In the region, China ordered residents of Chengdu to stay home following new virus outbreaks. The Shanghai Composite Index added less than 0.1%, the Nikkei 225 in Tokyo shed 0.04% and the Hang Seng in Hong Kong sank 0.85%. MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.52% lower.
In Europe, stocks opened higher ahead of the weekend. However, the overall risk mood is more tepid with US futures down slightly, awaiting the US jobs report. Softer numbers will provide a short-lived relief for equities and tone down the Fed’s aggressiveness. Meanwhile, Germany’s July trade balance came in at 5.4 billion euros versus 4.8 billion euros expected.
Elsewhere, the US dollar surged to fresh twenty-year highs around the 110.00 figure on Thursday to come under some selling pressure today as traders proceeded to profit-taking after another spectacular rally. The USD index slipped to the 109.30 zone, staying on the defensive during the early European hours. Strong US jobs data could give a lift to the buck at the end of the trading week. As such, may struggle to get back above parity on a daily and weekly closing basis.