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Wall Street stalls, Asian stocks rise ahead of US payrolls

US stocks slipped slightly on Thursday while Asian stocks were strong at the end of the week as traders positioned themselves for US nonfarm payrolls data due out later Friday. This week has been characterized by labour market surprises out the US with job openings coming in unexpectedly high on Tuesday and weak payroll data following the next day. Investors are interpreting any signs of labour market resilience as a sign the Federal Reserve could push ahead with higher interest rates while weak jobs data is seen as a sign the hiking cycle could end soon.

Shane Strowmatt, LGT
Tempo di lettura
5 minuto
Mixed markets
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The latest data out of the US labour market was initial jobless claims on Thursday which showed applications for unemployment hovering near historical lows. Initial jobless claims increased slightly to 207,000 last week. A more detailed look at the labour market will come when the US Bureau of Labor Statistics releases its Employment Situation Summary on Friday.

Wall Street ended Thursday’s session with only mild losses after a volatile trading week. The Dow Jones Industrial ended the day essentially flat, while the S&P 500 and tech-heavy Nasdaq-100 both lost 0.1%.

In individual stocks, shares of Alstom lost almost 40% of their value on Thursday after the French train manufacturer cut its forecast for free cash flow. Trading was suspended temporarily in Paris. Both the Euro Stoxx 50 and CAC 40 ended Thursday’s session roughly flat.

Oil prices to plummeted this week due to concerns about demand given an economic downturn. Oil prices were down about 2% on Thursday after having already fallen about 6% the day before. Crude was trading around 94 dollars a barrel last week and spent most of Thursday between 82 and 85 dollars a barrel.

In the Asia-Pacific region, stock markets jumped, despite the weak close on Wall Street. Hong Kong's Hang Seng Index led gains, trading up 1.6%. Markets in mainland China were closed for a holiday week. In Tokyo, the Nikkei 225 was down 0.1% while in South Korea, the Kospi increased 0.3%. Australia’s S&P/ASX 200 gained 0.4%.

Elsewhere in Asia, the Reserve Bank of India kept the country’s key repo rate unchanged at 6.5% on Friday. The move was largely expected by markets. The Indian rupee didn’t move much after the announcement.

In Europe, Germany’s trade balance fell less than expected in August, with both exports and imports declining. The trade surplus decreased to 16.6 billion euros from 17.7 billion euros in July. Europe’s largest economy - which is traditionally heavily dependent on exports - has struggled to grow this year as key export markets such as China have failed to provide support. Manufacturing activity in Germany has been deep in contractionary territory lately with Germany’s Manufacturing PMI at a low 39.6 in September.

Corporate news in focus: Givaudan Investor Day.

Economic data in focus: Swiss unemployment rate (07:45 CET), German industrial orders (08:00), French trade balance (08:45), Italian retail sales (10:00), US nonfarm payrolls (14:30).


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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.