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On Friday, European shares rose solidly from the previous night as US markets were closed for the July 4th holiday, while Asian shares were mostly lower.
Japan’s stock benchmark Nikkei average rose above 41,000 yen early Friday but later fell from Thursday’s record high of 40,913.65 yen. U.S. futures rose slightly and crude oil prices fell.
The U.S. government is due to release a comprehensive update on how many workers employers added in June, with traders closely watching the figures to suggest the economy has slowed enough to prove inflation is under control but not enough to tip the economy into a recession.
That would increase the likelihood that the Federal Reserve would cut interest rates, which have been held at two-decade highs, easing pressure on the economy by lowering borrowing costs.
The jobs report is expected to show that employers added 190,000 jobs, a solid increase but down from a strong 272,000 in May.
“The upcoming June jobs report will play a key role in shaping near-term Fed rate cut expectations. The market currently expects two rate cuts this year with a reasonable probability, while the Fed’s median forecast is for just one rate cut in 2024,” Anderson Alves of Active Trades said in a commentary.
In Asian markets early on Friday, the Nikkei average fell 0.2 percent to 40,843.90 after the government said a bigger-than-expected rise in prices in May dampened consumer sentiment, causing household spending to fall 1.8 percent.
Chinese markets were significantly weaker, with Hong Kong’s Hang Seng Index down 1.1% to 17,823.67 and the Shanghai Composite Index up 0.9% to 2,929.98, trading near its lowest level since February.
The Seoul Composite Stock Price Index (KOSPI) rose 1.3 percent to 2,860.26 after Samsung Electronics forecast that its second-quarter operating profit would rise to 10.4 trillion won ($7.52 billion), more than 15 times higher than the same period last year.
Like other computer chip makers such as Nvidia, Taiwan’s TSMC and Tokyo Electron, Samsung is benefiting from a recovery in the semiconductor industry fueled by the spread of artificial intelligence applications.
Elsewhere in the region, Australia’s S&P/ASX 200 fell 0.2% to 7,820.20, Taiwan’s Taiex rose 0.1% and Bangkok’s SET added 0.2%.
US markets were closed on Thursday and attention turned to the UK, where the FTSE 100 index was up 0.2% early on Friday after exit polls and partial vote counts suggested the UK Labour Party would win a landslide victory in parliamentary elections.
Britain has endured years of turmoil under Conservative governments that have left many voters pessimistic about the country’s future. Britain’s departure from the European Union was followed by the coronavirus pandemic and Russia’s invasion of Ukraine, which have hit the economy hard. Rising poverty and cuts to public services have led to discontent with a “broken Britain.”
The British pound rose to $1.2773 from Thursday’s close of $1.2760. The euro rose to $1.0821 from $1.0812.
On Thursday, the FTSE 100 rose 0.9% to 8,241.26 and Germany’s DAX rose 0.4% to 18,450.48. In Paris, the CAC 40 rose 0.8% to 7,695.78.
During Wall Street’s holiday-shortened trading session on Wednesday, the S&P 500 rose 0.5%, hitting its 33rd all-time high this year, the Dow Jones Industrial Average lost 0.1% and the Nasdaq Composite rose 0.9%, hitting a new all-time high.
In other trading on Friday, benchmark U.S. crude oil fell 17 cents to $83.71 a barrel in electronic trading on the New York Mercantile Exchange.
Brent crude, the international standard, fell 32 cents to $87.11 a barrel.
