WSJ: European Stocks, Bonds Rebound Ahead of U.S. Jobs Report
European stocks and bonds climbed Friday, rebounding from the previous session’s losses.
Markets fell sharply on Thursday after European Central Bank chief Mario Draghi failed to provide clear enough signals that a broadening of its stimulus program is imminent. But they recovered as investors looked ahead to Friday’s U.S. jobs report.
Analysts forecast the world’s largest economy added 230,000 jobs in November.
Traders said some investors were reassessing Mr. Draghi’s message, and betting the wide-ranging asset purchases including government bonds are likely to be on the way in January.
The Stoxx Europe 600 was 1.1% higher, having fallen more than 1% in the previous session. Data showing stronger-than-expected industrial orders in Germany in October gave shares an early boost.
Frankfurt’s DAX index was 1.2% higher. U.S. futures pointed to a 0.1% opening gain for the S&P 500. Changes in futures aren’t necessarily reflected in market moves after the opening bell.
In bond markets, yields on Spanish and Italian 10-year debt hit record lows of 1.95% and 1.83%, respectively. Yields fall as prices rise.
In currency markets, the euro edged 0.2% lower against the dollar to $1.2364. The common currency had surged on Thursday as investors perceived Mr. Draghi’s comments to be less urgent than his previous calls for more easing.
A solid U.S. labor report on Friday should help the dollar claw back some of those losses against the euro, according to currency strategists at BNP Paribas .
“The ECB decision disappointed elevated expectations,” they said, adding that with further action likely in January the euro should begin to weaken again.
Elsewhere in currency markets, the Russian ruble gained against the dollar following its recent heavy losses. Data released Friday showed the Russian central bank this week made its heaviest currency intervention in more than a month in an attempt to deter speculators from betting against the currency.
The yen continued to weaken, with the dollar rising to ÂĄ120.41 against the Japanese currency, a new seven-year high.
In commodities markets, Brent crude oil was down 0.6% at $69.24 a barrel, and gold was 0.3% lower at $1,204.00 an ounce.
