Global Stocks Steady Ahead of Jobs Report — Update

By Riva Gold 
 Stock Market Quotes, Business News, Financial News from

Global stocks were mostly steady Friday just hours before the release of the monthly U.S. jobs report.

The Stoxx Europe 600 inched up 0.2% in morning trade, as gains in auto and bank shares offset losses in energy companies. Brent crude oil was last up 0.8% at $46.80 a barrel, but remains down over 7% so far this week.

Futures pointed to a 0.1% opening gain for the S&P 500, as investors shrugged off modest falls in Asian markets.

The U.S. monthly employment data, due at 8:30 a.m. ET, will be closely watched to gauge the health of the world’s largest economy.

Following a dismal report in May, “I think we’ll have a rebound, but I’m not so sure how great it’s going to be,” said Bruce Bittles, chief investment strategist at Robert W. Baird & Co.

A third consecutive weak reading could deepen fears of an economic slowdown, but economists surveyed by The Wall Street Journal estimate nonfarm employers added a seasonally adjusted 165,000 jobs last month, a steep improvement over the previous month.

Given escalated concerns over the fallout from the U.K.’s Brexit vote, today’s jobs report has perhaps added importance, said Derek Halpenny, European head of global markets research at Bank of Tokyo-Mitsubishi UFJ, in a note. Bad news on the U.S. economy could trigger a more pronounced flight to quality as investors give greater credence to the prospect of a more serious downturn for the global economy, he said.

Even if the report comes in above expectations, that instability in the global economy and financial markets could still make it very difficult for the Federal Reserve to raise rates this year, analysts said.

Federal Reserve Bank of Cleveland President Loretta Mester said Thursday in a Wall Street Journal interview that the U.S. central bank has time to weigh the impact of the Brexit vote before making its next decision about interest rates.

“I’ve been one of the more positive ones in terms of the outlook for the U.S. economy, and I continue to be positive about it. But I take on board that there is increased uncertainty” which could change officials’ expectations that the Fed’s short-term interest rate target will rise gradually over time, Ms. Mester said.

In currencies, the dollar edged down 0.1% against the yen to Yen100.6500.

The British pound rose 0.3% against the dollar to $1.2935, even after data showed British consumer confidence suffered its steepest fall in two decades following the U.K. vote to exit the European Union.

U.S. stocks turned lower after oil inventories showed a much smaller draw than expected.

Earlier, stocks in Asia closed lower, weighed by the losses in oil prices and on Wall Street. Japanese stocks fell 1.1%, while stocks in Hong Kong fell 0.7% and stocks in Shanghai fell 1%. Australian shares were little changed.

Michael S. Derby contributed to this article.

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