Darren Sinden from educational provider Trade Uni discusses the latest market moves.
Yesterday was a hesitant session from equity markets ahead of the US non-farm payrolls report for September, to be released today at 1.30pm (UK time). Crude oil prices moved higher again, with Brent testing $78 per barrel and WTI trading above $74 for part of the session, but both flavours are weaker this morning in early European trade. The spike in oil meant that energy stocks were the best performers at a sector level, with the S&P 500 energy sector index adding 1.58%, taking its weekly gains to north of 8%.
Materials and consumer discretionary sectors were the biggest fallers in the US, down by 1.15% and 1.28% respectively. The Euro Stoxx auto sector was down 2%, with Stellantis down by 4%, Porsche by 3.6% and Continental by 3.5%. Energy was the only European sector to make gains on the day, rising by just 0.8% on the day.
At an individual stock level MarketAxess rose by almost 7.5% following an upgrade from Goldman Sachs. The stock has added 13.6% over the last month and 36% over the last three months. Tesla was down by 3.36%; the stock wasn’t helped by news of the fifth Cybertruck recall this year, recalling 27,000 trucks due to a software glitch affecting the rear-view camera. In the Euro Stoxx 50, Vonovia, Vinci and Kone Oyj were all down by more than 2 5%. The only gainer of note on the day was TotalEnergies, which added 1.5%.
All eyes will be on the US this afternoon for the release of September’s non-farm payrolls report. August’s report showed headline job creation at 142,000 new roles; the consensus forecast for September is 140,000 new jobs, with unemployment expected to remain unchanged at 4.2%. The rate of job creation and the level of unemployment in the country feeds directly into sentiment about the future path of US interest rates. Higher unemployment and weaker job creation numbers could bolster the case for more aggressive rate cuts by the US Federal Reserve, while more jobs and lower unemployment could mean that the Fed takes its foot off the gas. This could create a strange situation where equity traders may be rooting for “bad news” this afternoon.
Gold and silver are both opening modestly higher in Europe. It's a very quiet start to the session on the foreign exchanges, with few movers of note among the majors. USD/JPY is the pick of the bunch, with the yen strengthening by 0.46% and the pair trading around ¥146.12. US 10-year treasury bond yields are broadly unchanged at 3.839%, but they are up by 0.11% over the last month
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