European stocks stagnate ahead of US jobs report
European markets were flat on Friday morning as investors tracked corporate earnings and awaited the key US jobs report.
The pan-European Stoxx 600 was little changed in early trading. Autos gained 0.8% while insurance stocks fell 0.8%.
Earnings continue to drive individual stock prices in Europe. Allianz, Deutsche Post, the London Stock Exchange Group and WPP were among the companies that reported before the bell on Friday.
-Elliot Smith
Asian markets shake fears over military tensions around Taiwan
Asia-Pacific markets rose on Friday as investors dispelled fears over Chinese military exercises near Taiwan, which follow US House Speaker Nancy Pelosi’s visit to the autonomous island this week.
MSCI’s broadest index of Asia-Pacific stocks outside Japan rose 0.74%. Mainland China’s Shanghai Composite gained 0.28% and the Shenzhen Component rose 0.64%.
Taiwan’s Taiex jumped more than 2%, with chipmaker TSMC rising 2.8%.
Fewer jobs doesn’t mean a weaker economy, investor says
While Friday’s jobs report shows the US economy added fewer workers in July than the previous month, that’s not necessarily a sign of economic weakness, according to Brad McMillan, CIO at Commonwealth Financial Network.
“If we see a reduction in hiring, even to the expected number, it seems much more likely to be due to a shortage of workers, rather than a sudden labor demand shock,” McMillan said. in a note. “With high demand, what matters here is the availability of labor.”
—Yun Li
Some on Wall Street don’t think the comeback rally can last
The Fed’s commitment to bringing inflation down along with easing recession fears sparked a rally of relief in the market. The S&P 500 is now 14.2% above its 52-week intraday low of 3,636.87 since June 17. The benchmark also just had its best month since November 2020, gaining more than 9% in July.
However, some on Wall Street are skeptical that the rally will last much longer. Max Kettner, chief multi-asset strategist at HSBC bank, said the return was “wishful thinking” and that he would need to see another revision to rate hike forecasts and another sharp drop in real yields. to believe it.
Widely followed Morgan Stanley’s Mike Wilson also called the rally short-lived as corporate earnings begin to deteriorate.
Consumer discretionary leads the gains, with energy the biggest laggard this week so far
Six of the 11 S&P 500 sectors were in the green week so far, led by consumer discretionary, which gained 2.9%.
The most negative sector this week was energy, which fell more than 8% and is on track for its worst week since June 17. The drop in energy names came amid falling oil prices. WTI is down more than 10% this week, on pace with its worst week since April.
—Yun Li
