News Column

European Stocks Seen Rising Ahead Of US Jobs Report

June 5, 2014

VIENNA (Alliance News) - Trading in stock futures suggests the European markets will begin Friday's session on a positive note. A raft of stimulus measures from the European Central Bank to boost bank lending and spur growth buoyed sentiment yesterday, although some of the measures, like the negative deposit rates and cutting the refinance rate were widely expected.

The euro held steady in Asian deals after staging a dramatic rebound from a four-month trough hit yesterday on ECB measures. Investors are now solely focused on the US jobs report due later in the day, which is expected to show an increase of about 215,000 jobs in May following the addition of 288,000 jobs in April. After disappointing private-sector jobs report, it remains to be seen if the non-farm payrolls report modifies expectations for a spring revival of the world's largest economy.

Closer home, investors eye German industrial production and trade balance data for April as well as UK trade data for clues whether the economic outlook for the euro zone is improving. European Central Bank Vice President Vitor Constancio is due to deliver a speech in London following yesterday's rate cut.

After using a combination of measures to provide additional monetary policy accommodation, ECB President Mario Draghi on Thursday pledged to do more if needed to ward off deflationary pressures.

Asian stocks are turning in a mixed performance as caution ahead of US jobs data tempered optimism over the new ECB economic stimulus measures.

In domestic corporate news, German stock exchange operator Deutsche Boerse AG is mulling the sale of International Securities Exchange Holdings, Inc., its US options exchange, the Bloomberg reported.

French utility GDF Suez SA is seeking to sell a 30% stake in its Australian electricity generation and retail business as part of its efforts to cut debt and boost profits, the Wall Street Journal reported, citing people familiar with the matter.

The major European markets closed mostly higher on Thursday after the ECB rolled out sub-zero interest rates and launched a series of measures to revive the region's fragile economy. The German DAX rose 0.2% and France's CAC 40 climbed 1.1%, but the UK'sFTSE 100 slipped 0.1%.

US stocks rose notably overnight after the European Central Bank announced measures to fight deflation and stimulate the economy. With focus remaining on ECB's policy decision, investors shrugged off a report showing a modest rebound in initial jobless claims in the week ended May 31st. The Dow and the S&P 500 rose 0.6% and 0.7%, respectively to fresh record highs, while the tech-heavy Nasdaq rallied 1.1% to reach its best level in over two months.

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Source: Alliance News

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