European stocks rise slightly ahead of US jobs data

The DAX chart of the German stock price index is pictured on the stock exchange in Frankfurt, Germany, February 22, 2022. REUTERS/Staff

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  • The STOXX is expected to end the week down around 0.5%
  • US non-farm payrolls at 12:30 GMT
  • Faurecia slips on a capital increase of 705 million euros
  • Leonardo on Rheinmetall’s offer for a minority stake in the unit

June 3 (Reuters) – European stocks edged higher on Friday as investors focused on U.S. nonfarm payrolls data for clues about the Federal Reserve’s next policy move.

The pan-European STOXX 600 index (.STOXX) rose 0.2% as volumes were expected to be subdued due to the holidays in the UK and China. The day’s gains reduced weekly losses to around 0.5%.

Healthcare (.SXDP), Industrials & Mining (.SXPP) boosted the STOXX 600, but the automotive sector (.SXAP) fell 0.4% while France’s Faurecia (EPED.PA) fell 0.4%. 5.1%.

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The auto parts supplier said it had launched a 705 million euro ($758 million) capital raise to fund its acquisition of German rival Hella . Read more

Mining (.SXPP) and energy (.SEXP) stocks also fell. Oil prices fell after OPEC+ decided to increase production.

On the data front, investors are hoping any signs of slowing U.S. jobs could prompt the Fed to adopt less aggressive policy after its members signaled overnight that the tightening may not end. in September if inflation continues to rise. Read more

Meanwhile, this week’s data showing record inflation in the eurozone has spurred bets that the ECB could be forced to tighten earlier or make bigger interest rate hikes. [nL8N2XN337]

The central bank has so far signaled its intention to start raising rates in July to reach 0% or more by September.

“Given the dramatic trend in inflation and the fact that the ECB is so clearly ‘lag behind the curve’ relative to the Fed, ECB language should tend to become more hawkish,” the authors wrote. Commerzbank analysts in a note.

European stock markets started the week on stronger footing after China eased some COVID-19 restrictions and revealed more stimulus, but optimism was quickly dashed by data indicating economies were tipping. towards recession. Read more

The European Union’s partial ban on Russian oil imports, in retaliation for its invasion of Ukraine, has also fueled fears of a further rise in inflation.

“A recession, if any, will not occur this year but most likely in 2023. That said, we expect the market to more correctly price in a slowing economy,” said equity strategists at Generali Investments. .

Among other stocks, Italy’s Leonardo (LDOF.MI) rebounded 2.8% after Germany’s Rheinmetall (RHMG.DE) bid for a minority stake in its OTO Melara gun-making unit, according to a document and two sources close to the file.

Rheinmetall has set a value of 190 to 210 million euros ($203.91 to 225.37 million) as an indicative price for the 49% stake in OTO Melara. Read more

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Reporting by Susan Mathew in Bengaluru; Editing by Shailesh Kuber and Anil D’Silva

Our standards: The Thomson Reuters Trust Principles.

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