Friday,07 June 2024 16:43:44

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Friday,07 June 2024 at 15:45

UK and European markets remained weak in the afternoon after a blockbuster U.S. Jobs Report caused traders to dial back expectations for Federal Reserve rate cuts.

U.S. stocks were slightly lower and Treasuries fell with the announcement that Nonfarm Payrolls rose 272,000 in May versus analyst expectations of 180,000 and hourly earnings figures also outpaced forecasts. A resilient labour market could also mean resilient inflation which sparked investors’ fears that this might dissuade the Fed from lowering interest rates in the near term.

Asia-Pacific stocks were mixed as China’s May exports beat expectations, climbing 7.6% and vastly higher than the 1.5% rise seen in April. Japan also released household spending figures for April, a key metric to assess if the Bank of Japan’s ‘virtuous cycle’ of rising wages and prices was underway. The average monthly consumption expenditure per household increased 3.4% in nominal terms and 0.5% in real terms and marked the first rise in real household spending since February 2023.

Gold prices fell over 2.7% on the latest U.S. job numbers and data showing that China’s central bank had paused gold purchases in May.

The U.S. Dollar rose on the news that the U.S. economy had created more jobs than expected in May, reducing the chances for multiple rate cuts from the Federal Reserve.

Oil prices reversed earlier gains to trade lower after OPEC+ members tried to reassure markets by indicating their readiness to pause or reverse output agreements.

In corporate news, administrators to The Body Shop are reportedly aiming to secure a sale of the stricken cosmetics retailer by the end of the month, even after its former owner veers away from making an offer for it. FRP Advisory, which was appointed to handle the chain’s insolvency earlier this year, has asked for indicative bids by next Tuesday with a view to hopefully sealing a sale before the end of June.

Marks and Spencer, which was tipped as a possible bidder has reportedly decided against making an offer, while there was growing doubt also that rival Next would bid.

The Body Shop now trades from roughly 100 stores following a shop closure and redundancy programme undertaken in recent months.

Markets

the close

FTSE 100 8,251 (-0.41%)

FTSE 250 20,562 (-0.74%)

DAX 18,556 (-0.52%)

16:30

Dow Jones 38,931 +0.11%

S&P 500 5,349 (-0.07%)

NASDAQ 17,128 (-0.27%)

Fixed Income

UK 10-YR YIELD 4.259

Exchange Rates

GBP/USD 1.272

GBP/EUR 1.177

Commodities

Gold $2,308 (-2.78%)

Brent $79.59 (-0.46%)

Important - No news or research item should be construed as a recommendation to trade. The inclusion of securities within this report does not necessarily imply their suitability for individual portfolios or situations in respect of which further advice should be sought. Information contained in this report has been compiled from sources believed to be reliable but is not warranted to be accurate or complete.