BLBG: Dollar Advances With Stocks Before Payrolls Data: Market Wrap
Pound weakens after U.K. services growth cools as costs weigh
Dollar pares its longest run of weekly losses since 2010
The dollar climbed and European stocks gained before a report economists forecast will show employment growth in the U.S. expanded at a faster pace in January. Bonds in Europe slid, while oil advanced.
Bloombergâ€™s Dollar Spot Index rose, paring a sixth weekly decline, its longest losing streak since 2010. Europeâ€™s Stoxx 600 index advanced and the regionâ€™s bonds dropped. Britainâ€™s pound dropped against most of its major peers after growth slowed in the service industry amid surging costs.
Central bank decisions have dominated the financial markets all week, as policy makers from Japan to the U.S. try to assess the impact of Americaâ€™s new leadership on global growth. Investors are also looking for clues on economic strength amid a wave of corporate earnings. While signs point to increasing confidence that growth will accelerate, data have painted a murkier picture, highlighting the significance of Fridayâ€™s jobs report.
â€śPeople are waiting for evidence that cyclicals are actually delivering the earnings growth,â€ť Stephen Macklow-Smith, head of European equity strategy at JPMorgan Asset Management in London, said in an interview with Bloomberg TV. â€śProfitability can recover from here so weâ€™re trying to play through areas of the market with more exposure to economic growth. â€ť
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Whatâ€™s coming up for the markets:
Economists expect a 180,000 increase in U.S. nonfarm payrolls for January when the Labor Department releases jobs data on Friday. With both hiring and unemployment likely to remain relatively stable, the focus on the jobs report will center on wage pressures.
European stocks rose 0.6 percent as of 7:51 a.m. in New York, while futures on the S&P 500 added 0.2 percent.
The Bloomberg Dollar Spot Index added 0.3 percent. The measure is down 2.5 percent so far in 2017.
The pound weakened 0.3 percent to $1.2493, while the euro slipped by 0.2 percent.
Russiaâ€™s ruble strengthened 0.2 percent after the central bank left its key rate unchanged and said the potential for a cut in the first half of the year has diminished.
The yield on 10-year U.S. Treasuries was little changed at 2.48 percent.
The yield on German bonds due in a decade added one basis point to 0.43 percent, while similar-maturity debt yields of France, Spain and Italy rose at least three basis points.
Oil headed for a third weekly gain as OPEC reached about 60 percent of its output-cut target and the U.S. was said to be planning new sanctions on Iran after a missile test. West Texas Intermediate crude advanced 0.3 percent to $53.71 a barrel.
Gold slipped 0.3 percent to $1,211.70 an ounce, poised for a weekly increase of 1.7 percent as political risk spurred demand for a haven.
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