European stock markets edged up, as traders looked ahead to Friday’s release of the latest U.S. jobs report, which could have implications for upcoming Federal Reserve interest rate decisions.
By 04:04 ET (08:04 GMT), the pan-European Stoxx 600 had climbed by 0.3%, putting it on pace to end the week slightly higher. Meanwhile, the Dax in Germany added 0.1%, France’s CAC 40 rose by 0.1%, and the FTSE 100 in the U.K. advanced by 0.2%.
Economists expect the data from the Labor Department’s Bureau of Labor Statistics to show that the U.S. added 75,000 roles in August, up slightly from 73,000 in July.
Analysts have suggested that a soft or even tepid reading could all but cement expectations of a Fed rate reduction at the central bank’s September 16-17 gathering. According to CME’s FedWatch Tool, markets are pricing in a nearly 100% chance of a 25-basis point drawdown in borrowing costs from the Fed’s current target range of 4.25% to 4.5%.
Fed officials are facing pressures to both pillars of their mandate -- keeping price growth stable and promoting maximum employment -- although recent comments from policymakers have indicated that supporting the labor market may be their current priority. Cutting interest rates can help to spur spending by businesses and consumers, albeit at the risk of pushing up lingering inflation.
Separate labor market data earlier this week further bolstered wagers that the Fed will slash rates this month. Figures showed that private-sector hiring slowed last month, while new weekly claims for unemployment benefits inched up by more than anticipated -- both fresh indications of a possible cooling in the American jobs picture.
In individual stocks, shares in Hexagon surged after the Swedish group announced a $3.16 billion deal to sell its design and engineering division to U.S. firm Cadence Design. The transaction is anticipated to close in the first quarter of next year.
Meanwhile, Orsted shares slipped after the Danish energy company brought down its operating outlook due to lower wind speeds than usual. Banking software name Temenos also slid after it announced the immediate departure of CEO Jean-Pierre Brulard.
Source :
https://www.investing.com/news/stock-market-news/european-stocks-edge-higher-ahead-of-hotlyanticipated-us-payrolls-report-4226073
