Stocks Fall as Traders Take Cover Before Payrolls: Markets Wrap
(Bloomberg) — Global stock markets retreated on Friday as traders took a cautious stance ahead of U.S. jobs data that will offer fresh insight into the health of the economy and the outlook for interest rates.
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Nasdaq 100 futures fell 0.3%, while S&P 500 futures retreated 0.2%.The Chinese benchmark was pushed into a bear market.Europe’s Stoxx 600 was little changed.
Bond markets responded to similar guarded sentiment. UK gilts extended this week’s sell-off, with the 10-year yield rising another three basis points to 4.84% as government bonds across Europe retreated.
Financial markets have been volatile at the start of the year, with U.S. yields rising as investors softened their view on the pace of Federal Reserve easing keep
Friday’s U.S. nonfarm payrolls data is expected to show a slowdown in hiring in an otherwise strong labor market.The average estimate was that the economy added 165,000 jobs in December.The unemployment rate is expected to hold at 4.2% growth in average hourly earnings is seen cooling compared to the previous month.
“Given how quickly Fed hawks have taken positions in recent weeks and how much more investors are excited by dovish signals, the market’s reaction to soft data may outpace its reaction to strong numbers,” said a senior analyst at Swissquote Bank. Ipek Ozkardeskaya.
Several Fed officials confirmed on Thursday that the central bank is likely to keep interest rates at current levels for a long time, only cutting again when inflation cools significantly.
“The Fed is worried about the incoming administration,” Skyler Weinand, chief investment officer at Regan Capital, said on Bloomberg Television. he said.
The dollar index has changed little. The yen rose 0.2% against the dollar on a report that Bank of Japan officials are likely to consider raising inflation forecasts.The pound remained under pressure, down 0.2% in the previous session than after hitting a one-year low.
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