PARIS, May 3 A rally in European stocks towards 2013 highs is
set to pause on Friday morning ahead of U.S. monthly jobs data expected to
confirm that the world's biggest economy has been losing steam.
Any dip was seen limited, however, with investors betting soft macro data
means that strong central bank support will remain in place for a while. On
Thursday, the European Central Bank's interest rate cut fuelled gains in
equities, and market players said the ECB's readiness to take additional
measures to boost economic growth would support stocks in the near term.
"Yesterday was a volatile session following (ECB President Mario) Draghi's
speech and now the focus turns to the U.S. payrolls. But all in all, buyers are
in control and the year's highs are in sight," FXCM analyst Nicolas Cheron said.
At 0612 GMT, futures for Euro STOXX 50 up 0.3 percent, for UK's
FTSE 100 down 0.1 percent, for Germany's DAX up 0.06 percent and
for France's CAC up 0.4 percent.
U.S. non-farm payrolls for April, due at 1230 GMT, are expected to have
increased by 145,000 jobs, which would not by enough to counter recent sluggish
data. Softer-than-expected figures from the ADP National Employment Report on
Thursday also fuelled speculation the payrolls number could miss the forecast.
Societe Generale cross asset analysts see the payrolls number coming out at
175,000, above the consensus and eclipsing the average of 168,000 for the first
three months of the year. The analysts said in a note that if their forecast
materialises, Wall Street's S&P 500 should rally 0.2 percent shortly
after the data is released.
The Euro STOXX 50, the DAX and the FTSE 100 are
less than 2 percent away from 2013 highs, while the CAC 40 has already
hit a fresh 2013 peak, surging to near two-year high during the session on
Banks will be in the spotlight on Friday after France's BNP Paribas
posted a smaller-than-expected drop in profits, mirroring
forecast-beating results from Europe's big four investment banks Deutsche Bank
, Barclays, UBS and Credit Suisse.
Out of the 55 percent of the STOXX 600 companies that have posted quarterly
earnings so far, 53 percent of them have missed earnings forecasts, a sharp
contrast with results from the United States where only 26 percent of S&P 500
companies have missed forecasts, according to Thomson Reuters StarMine data.
However, a number of positive surprises have come from Europe's financials,
with 67 percent of the companies in the sector meeting or beating forecasts,
while the materials sector, home of steel and mining companies, has posted the
worst set of results, with only 31 percent of companies meeting or beating
Japanese markets were closed on Friday for a public holiday.
MARKET SNAPSHOT AT 0615 GMT
LAST PCT CHG NET CHG
S&P 500 1,597.59 0.94 % 14.89
MSCI ASIA EX-JP 552.44 0.15 % 0.81
EUR/USD 1.3065 0.02 % 0.0002
USD/JPY 98.09 0.14 % 0.1400
10-YR US TSY YLD 1.624 -- 0.00
10-YR BUND YLD 1.168 -- 0.00
SPOT GOLD $1,474.36 0.55 % $8.12
US CRUDE $93.75 -0.26 % -0.24
> GLOBAL MARKETS-ECB rate cut cheers stocks, euro subdued
> Wall St closes up on tech gains, S&P near 1,600
> FOREX-Euro nurses losses after ECB; focus on U.S. jobs
> PRECIOUS-Gold gains, heads for second straight weekly gain
> Copper climbs over 2 pct on stimulus push; US data eyed
> Brent steadies below $103, ECB rate cut supports; US jobs eyed
French bank BNP Paribas pledged to keep cutting costs and staff amid a
lacklustre economic environment after reporting a 45 percent drop in
first-quarter net income on Friday.
Air France-KLM reported a narrower operating loss in the first quarter and
confirmed downward pressure on unit costs and debt, but stopped short of giving
detailed financial forecasts for the year.
French water and waste group Veolia Environnement raised its 2015 cost
reduction target as it posted lower first-quarter sales and profits, hit by
Europe's weak economy.
The French steel-tube maker posted a 26 percent rise in first-quarter core
profit thanks to higher sales in the oil and gas sector, especially in Brazil
and the Middle East, and cost cuts.
Top shareholder Orpar said it sold 2.9 percent of the French spirits group
to help fund its purchase of cask and cork company Oeneo
New car sales in Italy, Europe's fourth-largest car market, fell 10.83
percent in April from the same month a year ago to 116,209 vehicles, Italy's
Transport Ministry said on Thursday.
UniCredit has sold its Kazakh unit ATF Bank ATFB.KZ for around $500 million,
a source close to the deal said, as it seeks to restore profitability after
being hit hard by the euro zone debt crisis.
Germany's Adidas reported a 2 percent decline in sales for the first quarter
on fewer major sporting events, ongoing problems at its Reebok brand and
The firm said on Friday its first-quarter wireless revenue fell 10.7 percent
to 315 million euros ($411.8 million) as competition in the market heated up.
Belgium's dominant telecoms operator said on Friday that higher costs for
its staff as well as lower revenues from mobile phones cut its profits in the
first quarter of 2013.