Asian markets traded with mixed momentum on Thursday, as a slowdown in China’s services sector highlighted uneven economic recovery in the region. European markets advanced on Wednesday and are expected to open slightly higher on Thursday, with futures data indicating modest gains across major indices. This follows a turbulent session for the UK on Wednesday, where bond prices and equities fell sharply amid political pressure on Finance Minister Rachel Reeves. US markets closed mixed Wednesday, with tech stocks leading gains. Investors are now turning their attention to the US labour market report due later on Thursday, which could provide further clues on the Federal Reserve’s next policy steps.
Asia-Pacific markets were trading with mixed momentum on Thursday. Japan’s Nikkei 225 was trading 0.2% lower, while Korea’s Kospi outperformed, gaining 1.2%. Australia’s S&P/ASX 200 was essentially flat, down less than 0.1%. Hong Kong’s Hang Seng Index dropped 0.7%, whereas mainland China’s CSI 300 rose 0.6%, buoyed by gains in financials and consumer stocks. In macroeconomic data, China's services sector expanded at a slower pace in June, with the Caixin services PMI falling to 50.6 from 51.1 in May, below market expectations of 51.0. The deceleration, reported on Thursday, was attributed to weaker domestic and overseas demand, as global economic growth cooled and US tariffs remained a concern despite recent reductions. While services activity marked its thirtieth consecutive month of expansion, the slowdown contrasts with stronger manufacturing data released earlier in the week, highlighting uneven recovery across sectors.
Vietnamese stocks reached their highest level in over three years on Wednesday after US President Donald Trump announced a trade agreement with Vietnam. The deal imposes a 20% tariff on Vietnamese imports to the US, while Vietnam will grant tariff-free access to American products. The Vietnam Index rose 0.3%, driven by gains in basic materials and technology stocks. Meanwhile, the Vietnamese dong weakened to a record low against the US dollar, which analysts suggest could help offset the tariff impact.
US stock markets closed mixed on Wednesday, with the Dow Jones Industrial declining slightly by 0.1% to 44,462 points, while the S&P 500 rose 0.3% and the Nasdaq 100 gained 0.6%. Investor focus remains on the upcoming US labour market report from the US Bureau of Labor Statistics, due later Thursday. Nike shares led the Dow with a 3.9% increase after a new US-Vietnam trade agreement, while Tesla shares rose 4.7% despite weaker delivery figures.
Private sector employment in the US declined by 33,000 jobs in June, led by losses in professional and business services as well as education and health services, according to the ADP National Employment Report released on Wednesday. Despite the slowdown in hiring, annual pay for job-stayers grew by 4.4% year-over-year, while job-changers saw a 6.8% increase. Gains in leisure, hospitality, and manufacturing partially offset the overall decline, with large establishments adding 30,000 jobs. ADP attributed the job losses to a hesitancy to hire and replace departing workers, though layoffs remain rare.
The unemployment rate in the euro area increased slightly to 6.3% in May 2025, up from 6.2% in April, but down from 6.4% in May 2024, according to Eurostat. The EU unemployment rate remained stable at 5.9% in May, showing a decline from 6% a year earlier. Youth unemployment also rose marginally, with the euro area rate at 14.4% and the EU rate at 14.8%, reflecting a small monthly increase. Despite the slight uptick, the overall labour market showed resilience, with unemployment figures declining year-on-year across most regions. European equities advanced on Wednesday, with broad-based gains across major indices. The Euro Stoxx 50 climbed 0.7% to 5320.55 points, while Germany’s DAX rose 0.5% and France’s CAC 40 outperformed, gaining 1% on the day. The Swiss Market Index (SMI) added 0.2%.
Corporate news in focus: There is no major corporate news scheduled today.
Economic data in focus: Swiss Consumer Price Index (08:30), euro-area Composite Purchasing Managers’ Index (10:00), US nonfarm payrolls (14:30), US unemployment rate (14:30), US average hourly earnings (14:30), US ISM Services Purchasing Managers’ Index (16:00).
Global economic and market trends at a glance
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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi
Source: LGT Bank (Switzerland) Ltd.