LONDON — European markets closed lower on Friday afternoon after a key US jobs report showed unexpected strength in the labor market.
The pan-European Stoxx 600 closed 0.8% tentatively, shortly after the Bureau of Labor Statistics release. Tech stocks fell 2.4% as most sectors and major exchanges plunged into negative territory.
US nonfarm payrolls rose 528,000 in Julywell above the 258,000 predicted by Dow Jones estimates and defying signs that the economic recovery is fading.
The show of force will be interpreted by investors as increasing the likelihood that the US Federal Reserve will act more aggressively to reduce inflation, since the risk that such action will tip the economy into recession is diminished.
Markets moved sideways this week as investors reacted to a flurry of corporate earnings. The European blue chip index closed the previous session slightly above the flatline.
The bank of england Thursday, interest rate hike of 50 basis points while forecasting that UK inflation will peak above 13% in October and the economy will enter a prolonged recession in the fourth quarter.
In the United States, stocks slipped after the jobs report as Wall Street weighed what a strong labor market would mean for the Fed’s rate-tightening campaign.
Asia Pacific Equities closed mostly higher overnight, with Taiwanese stocks leading the gains in the region as investors shrugged off Chinese military drills after Visit of Speaker of the United States House of Representatives Nancy Pelosi to Taiwan.
Earnings continued to drive individual stock prices in Europe. Allianz, Deutsche Post, the London Stock Exchange Group and WPP were among the companies that reported before the bell on Friday.
British financial services company Hargreaves Lansdown was the Stoxx 600’s best performer, adding nearly 5% after beating earnings expectations, while deutsche post added 4% after beating second-quarter earnings guidance.
At the bottom of the index, the German automaker and gunsmith Rheinmetall fell nearly 12% after slashing its forecast on defense orders.
WPP fell almost 9% after the British advertising giant after its first half results.
On the data front, French industrial production rose unexpectedly in June, posting a strong monthly increase of 1.4% despite forecasts of a 0.2% contraction amid ongoing supply chain issues. energy supply and crisis.
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