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Stocks tiptoe higher as U.S. jobs boost offsets weak European data, trade anxiety

Published 2019-10-07, 07:37 a/m
© Reuters.  Stocks tiptoe higher as U.S. jobs boost offsets weak European data, trade anxiety
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* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

By Ritvik Carvalho

LONDON, Oct 7 (Reuters) - Stocks edged up globally on Monday as broadly positive U.S. jobs data from last week quelled some fears about an economic slowdown, but nervousness over U.S.-China trade talks persisted and more weak European economic data trickled in.

European shares gained despite falling German industrial orders data, which underscored concerns about a looming recession in Europe's largest economy. The pan-European STOXX 600 .STOXX was up 0.54% by midday in London. .EU

Stocks worldwide took a battering last week, falling to their lowest in more than a month on fears of a U.S. economic slowdown. But positive U.S. jobs data on Friday helped spark a turnaround.

"I think the fact that the U.S. jobs report was broadly positive really put the brakes on the fear factor that was circulating last week - that the U.S. has been hit hard by the trade war," said David Madden, market analyst at CMC Markets in London.

Asian stocks rallied in the slipstream of gains on Wall Street, with MSCI's broadest index of Asia-Pacific Shares outside Japan rising 0.06%. .MIAPJ0000PUS

Japan's Nikkei stock index .N225 opened higher but reversed course and declined 0.2%. A key Japanese economic index fell in August and the government downgraded its outlook for the economy to "worsening," suggesting export-reliant Japan could slip into recession. All-Country World Index .MIWD00000PUS , which tracks shares across 47 markets, moved into positive territory, up 0.1% after hovering between flat and negative for most of morning trade.

Germany's DAX .GDAXI rose 0.5%, shrugging off data that showed industrial orders fell slightly more than expected in August. among investors in the euro zone dropped in October to its lowest in more than six years as stimulus measures taken by central banks failed to allay recession fears, a survey by the Sentix research group showed. the steady trickle of weak economic data, investors also had their eyes on U.S.-China trade talks. Bloomberg reported that Chinese officials are signalling they are increasingly reluctant to agree to a broad trade deal pursued by U.S. President Donald Trump. report briefly lifted the safe-haven Japanese yen and gold.

An impeachment drive by U.S. Democrats arising from a whistleblower's allegations that Trump leveraged $400 million in aid to secure a promise from Ukraine's president to investigate Trumps's political rival Joe Biden will continue this week. Several U.S. diplomats will head to Capitol Hill for closed-door testimony.

On Sunday, lawyers said a second whistleblower had come forward to substantiate the first complaint from an unnamed U.S. government official, which touched off the investigation. think it's fair to say the second whistleblower coming forward will be an issue for Trump. This strengthens China's bargaining position in the trade war," Madden said.

U.S. stock futures were 0.2% lower. ESc1 NQc1 .N

In currencies, the dollar was 0.1% higher against a basket of peers. The euro was flat at $1.0983 EUR=EBS . Sterling was lower on investors fears that Britain and the European Union are no closer to agreeing a Brexit withdrawal deal. GBP/

Euro zone government bond yields fell slightly as investors weighed signs of a resilient U.S. economy against concerns the U.S.-Sino trade negotiations could fail.

There was some outperformance in Portugal's bond market following a ratings upgrade on Friday and a weekend election. GVD/EUR

Yields in the biggest economies of the euro area were slightly lower, with the German 10-year Bund yield falling 1.1 basis points (bps) to -0.598% DE10YT=RR .

Oil prices rose. Brent crude futures were higher by 1% at $58.93 per barrel, while West Texas Intermediate (WTI) crude futures were 1.2% higher at $53.46. O/R

Spot gold XAU= fell 0.35% to $1,499.20 per ounce. GOL/

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