Stocks Wobble as Traders Eye uS Payrolls Data, Yen At 2-month High
HK stocks set for strongest weekly performance in 4 months
Yen at 2 month high up on increasing bets on rate hikes this year
Gold consistent near record peak, oil set for 3rd weekly drop
By Ankur Banerjee
SINGAPORE, Feb 7 (Reuters) - Global stocks meandered on Friday ahead of essential U.S. payrolls data as financiers thought about prospects that a more comprehensive trade war might be averted, while the yen struck its greatest in nearly two months on increasing chances of more rate walkings in Japan this year.
In a week that began with U.S. President Donald Trump starting a trade war, investors have been reluctant in making significant moves as threatened responsibilities on China were implemented.
Beijing's measured tit-for-tat response has left room for settlements, analysts say, which has allowed traders to focus on the AI style in China in the wake of home-grown start-up DeepSeek's advancement.
European futures indicated a controlled open after the pan-European STOXX 600 index closed at a record high on Thursday on the back of robust company incomes.
European stocks have staged their best efficiency in a years against Wall Street in the very first 6 weeks of 2025, but focus is now on whether those gains can be sustained.
Eurostoxx 50 futures were down 0.41%, imoodle.win while FTSE futures fell 0.39%. DAX futures relieved 0.21%.
Futures for Nasdaq and S&P 500 were down about 0.2% as shares of Amazon insinuated extended trading over night on weakness in the retailer's cloud computing unit and soft forecast.
In Asia, Hong Kong's Hang Seng Index struck a three-month high, poised for a 4% rise in the week, its greatest weekly performance sustained by DeepSeek-led AI bets.
China's blue-chip stock index was 0.4% greater after touching a one-month high leaving MSCI's broadest index of Asia-Pacific shares outside Japan at its highest since mid-December.
"Whilst there is substantial noise and uncertainty, we put on ´ t see intensifying trade tensions as a game changer in the potential customers for the Chinese market," said James Cook, financial investment director for emerging markets at Federated Hermes.
"China's larger problem is not Trump however the domestic economy."
On the economic front, jobless claims, layoffs and labour costs/productivity supplied a beginning to Friday's acutely awaited January work report, with the information likely to reveal the impact of wild fires in California and winter across much of the nation.
Nonfarm payrolls are anticipated to have increased by 170,000 jobs last month after surging 256,000 in December, a Reuters poll of financial experts showed.
"Markets might face some volatility around the data if it beats expectations, but it won't alter the path of the FOMC policy as more data will be needed," said Anderson Alves, a trader with ActivTrades.
Markets are pricing in 43 basis points of reducing this year from the Fed with a rate cut in July totally priced in as policymakers remain in no rush to begin the rate-cutting cycle again.
While political uncertainties kept investors careful, worries have actually alleviated that Trump's approach to tariffs could escalate into a worldwide trade war.
RISING YEN
The Japanese yen has actually been on a tear this week buoyed by safe-haven circulations along with increasing expectations of the Bank of Japan increasing rate of interest this year, with markets pricing in 34 basis points of walkings for the year.
The yen touched 150.96 per dollar in early trading, its greatest level because December 10 however was last a tad weaker at 151.71. The currency is headed for an over 2% rise against the dollar today, its strongest weekly performance given that late November.
Sterling was 0.1% lower at $1.24255 after dropping 0.5% on Thursday as the BoE cut interest rates by 25 basis points however it would beware moving forward, in the face of a possible inflation uptick and geopolitical concerns.
Oil costs rose partially on Friday but were on track for a third straight week of decline.
Gold costs steadied on Friday near record-high levels and were headed for their 6th succeeding weekly gain driven by safe-haven circulations.
(Reporting by Ankur Banerjee; extra reporting by Stephen Culp, Marc Jones and Alun John; editing by Shri Navaratnam and Sam Holmes)