Europe markets run out of steam as investors await US jobs report
March 03 2016 09:57 PM
KRISHNAN
Traders work at their desks in front of the German share price index at the Frankfurt Stock Exchange. The DAX dipped 0.2% at closing yesterday.

AFP/London

European and US stocks ticked lower yesterday as investors paused following this week’s sharp global rally and on the eve of a key US jobs report.
After Asian equities mostly rose, Europe’s leading indices all retreated and Wall Street followed suit as US data showed modestly slowing service-sector activity.
“Despite flirting with gains around lunchtime the weight of the day’s services data soon caught up with the global indices, displaying none of the manufacturing malaise-ignoring vigour that saw such confident gains at the start of the month,” Spreadex’s Connor Campbell said.
Shares on France’s CAC, the DAX in Frankfurt and London’s FTSE all dipped by around 0.2% at closing.
“With Brent Crude naughtily dipping its toe below $36.50 per barrel, and the sour taste of the morning’s services PMI (purchasing manager’s index) lingering on investors’ tongues, there was little reason for the FTSE not to join in with the market’s collective sigh,” Campbell said.
“The eurozone indices had the same idea,” he added.
Global markets have enjoyed a bumper rally this week as investors ploughed back into equities, which are traditionally deemed a risky investment.
Sentiment has been boosted by fresh Chinese stimulus, steadier commodity prices, bright US economic data and hopes of more monetary policy action from the European Central Bank next week.
Jonathan Loynes, of Capital Economics, said in a note to investors that the ECB had “signalled a further loosening of monetary policy” at its March 10 meeting.
“And while December’s under-deliverance highlights the risk of another disappointment, the deteriorating economic outlook should persuade the governing council to be bolder this time.”
After a nerve-shattering start to the year that saw trillions of dollars wiped off valuations, there are hopes that markets have found some stability.
Confidence has also been given a lift from a first round of positive US jobs data on Wednesday, with investors now looking to today’s US jobs report, expected to show the US economy added 190,000 jobs in February and the unemployment rate held steady at 4.9%.
Nick Stamenkovic, strategist at RIA Capital Markets in London, said risk markets were “taking a pause for breath” after the recent rally as investors awaited Friday’s key US employment report and the ECB gathering.
“Fading fears of a US recession, rising oil prices and dovish central bank comments have all contributed to the recent improvement in risk appetite,” he told AFP.



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