Asian, European Markets Meet Prior To US Jobs Data

Asian and European markets advanced on Friday, in line with a global equity rally ahead of a US jobs report that will give insight about the Federal Reserve’s next move on interest rates.

A frenzied selloff of Chinese stocks meanwhile slowed over reports of a regulatory clampdown.

The global bond market also eased after yields had jumped this week on concerns over mounting government debt.

London, Paris and Frankfurt were having a fair time of it, trading up at the open on Friday.

Across the pond, investors will be looking to US government jobs data due on Friday to cement rate-cut bets.

“All eyes will be on Friday’s nonfarm payrolls report with bad news likely to be interpreted as good news as it will raise the market probability that the Fed cuts rates,” said Victoria Scholar, head of investment at Interactive Investor.

Weekly data released on Thursday showed more first-time claims for unemployment benefits in the United States than analysts had expected, while figures from payroll firm ADP showed slowing private sector hiring in August.

“Investors now look for final confirmation that the weakening trend is entrenched and justifies a Fed cut –- or two,” said Ipek Ozkardeskaya of Swissquote bank.

In Asia, an August rally in Chinese stocks, fuelled by surging shares in semiconductor firms, ground to a halt this week, with Cambricon Technologies crashing 14 percent on Thursday, as investors weighed potential regulations.

China’s blue-chip CSI 300 benchmark was recovering on Friday after falling 2.1 percent the previous day — the largest drop since early April, when US President Donald Trump’s tariff threats caused the index to drop more than seven percent in one day.

Tokyo and Hong Kong were both up on Friday and Shanghai’s benchmark index, which was tracking down in early trading, had clawed back up.

Analysts said earlier falls had followed a Bloomberg report that China’s financial regulators might implement measures to cool the pace of the selloff in stocks.

“The selloff is more than a blip; it’s the first crack in the facade of a $1.2 trillion melt-up that had traders whispering about deja-vu and a speculative frenzy reminiscent of the 2015 ‘crazy bull’,” said Stephen Innes of SPI Asset Management.

Japanese long-term government debt yields also eased on Friday, while the Nikkei failed to extend early-session gains.