European stocks edge higher; caution ahead of nonfarm payrolls

European stock markets traded marginally higher Friday, with investors wary ahead of key US monthly jobs data and next week’s presidential election. 

At 04:05 ET (08:05 GMT), the DAX index in Germany traded 0.2% higher, the CAC 40 in France rose 0.3% and the FTSE 100 in the U.K. gained 0.4%. Nonfarm payrolls in focus

The European economic data slate is largely empty Friday, forcing investors to focus, almost exclusively, on the influential monthly payrolls release in the US.

The US economy is expected to have added just over 100,000 jobs in October, although risks are skewed to the upside given the private sector survey pointed to strong job gains and jobless claims were lower than expected. The unemployment rate is expected to remain at 4.1%, and average hourly earnings at 4.0%.

This release is widely seen as an important factor in determining future Federal Reserve monetary policy, but there would need to be a major surprise to seriously impact expectations for a cut by a quarter-point next week.

Also weighing on activity is the proximity to next week's US presidential election, the result of which could have ramifications for the European corporate sector.

Candidates Donald Trump and Kamala Harris appear to be running neck and neck according to most polls, but investors appear to have been trading on expectations that a Trump win could bring inflationary policies.

Back in Europe, the only data of note saw British house prices rise by just 0.1% in October, slowing sharply from a 0.6% monthly increase in September, according to mortgage lender Nationwide. Siemens in buying spree?

Turning to the corporate sector, the European earnings season takes a little break after a busy week.

Siemens (ETR:SIEGn ) stock rose 0.4% after managing board member Cedrik Neike said the German conglomerate has the financial muscle for further software acquisitions after its $10.6 billion purchase of U.S. industrial software company Altair.

However, again most attention will be on Wall Street after tech giants Apple (NASDAQ:AAPL ) and Amazon (NASDAQ:AMZN ) released quarterly results after the close on Thursday.

Apple reported a modest growth outlook, even as early iPhone 16 sales grew faster than iPhone 15 sales, while Amazon posted third-quarter profit and sales above Wall Street estimates.  Crude prices rise on raised tensions 

Oil prices rose Friday, paring some of the week’s losses, on raised geopolitical tensions in the Middle East following reports that Iran was preparing a retaliatory strike on Israel.

By 04:05 ET, the Brent contract climbed 2.2% to $74.43 per barrel, while U.S. crude futures (WTI) traded 2.4% higher at $70.95 per barrel.

Iran is preparing to attack Israel from Iraqi territory in the coming days, Axios reported on Thursday, citing Israeli intelligence, in response to Israel's strike against Iran on Oct. 26.

Also helping the tone was the release of data in China, which showed manufacturing activity swung back to growth in October, according to a  private-sector survey, echoing the official survey released earlier in the week. 

Both contracts are set to fall around 2% this week, after slumping more than 6% on Monday on the reduced risk of a wider Middle East conflict.

 

Source: Investing.com