Labor Data Moves Markets,EU Up On ECB Stance, Asia Mixed With Trade In Focus

Labor data was weaker than expected but still supported market action in early Friday trading.
Thomas Hughes
E-mini Dow Jones Industrial Average

The U.S. Futures Are Up In Early Friday Trading

The U.S. futures are up in early Friday trading indicating a continuation of this week’s market rebound. The move is led by the tech-heavy NASDAQ Composite which is up about 0.35%. The Dow Jones and S&P 500 are both up as well, about 0.25%, with trade talks in focus. In today’s news, talks between U.S. and Mexican representatives appear to be progressing well.

The Mexican ambassador to the U.S. says good progress was made although no deal has been reached. The Mexican Government has made some moves to bolster security at its southern border in a gesture of goodwill. A word from the U.S. is that tariffs may be delayed although the official stance has not yet changed.

In economic news, the U.S. Non-Farm Payrolls report came in at a tepid 75,000. This is about 100,000 below expectations and the lowest level in three months. The unemployment rate held steady at 3.6% and wages grew 3.1% from last year. The data, while low, is still a solid report for the labor market and consumer health. Expanding employment and rising wages are fueling the consumer economy.

European Markets Up On Draghi

The European indices are broadly higher following yesterday’s ECB policy announcement. The move is led by the French CAC which is up more than 1.5%, the German DAX and UK FTSE 100 are both up about 0.70% and 0.90% respectively. The ECB and its chief, Mario Draghi, have backed off what had been the most hawkish stance the bank has had in over a decade. The bank indicated it would not hike rates this year as planned and that it was ready to act in support of the economy if needed.

In political news, UK Prime Minister Theresa May has stepped down as the head of her political party. She will remain in position as Prime Minister until a replacement can be chosen. The status of the Brexit is unchanged, UK lawmakers can’t reach an agreement and even if they could it likely won’t be the deal offered by the EU.

In stock news, shares of Novozymes fell to the bottom of the rankings. The company lowered its outlook for the year and shares fell more than 7.25%. At the opposite end of the spectrum, shares of insurer ASR Nederland gained more than 5.0%.

Asia Higher, Trade Is In Focus

Asian markets were mostly higher on Friday with trade in focus. Oddly enough, today’s action was more about Mexico than China. Traders are eyeing the U.S./Mexican negotiations as their failure could spell doom for the U.S. economy. The Australian ASX led with a gain near 1.0%, the Japanese Nikkie followed at 0.53%, and the Korean Kospi trailed at 0.16%. The mainland Chinese and Hong Kong markets were closed for a holiday.

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