European stocks cut losses after U.S. jobs data

Czech trucking services firm Eurowag fell 12.0% in its London market debut after floating a day late and at a cut price. Auto stocks rose 0.3%, rebounding from a selloff in September on concerns about supply chain bottlenecks and chip shortages hitting production.


Reuters | Washington DC | Updated: 08-10-2021 19:52 IST | Created: 08-10-2021 19:50 IST
European stocks cut losses after U.S. jobs data
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European stocks recouped losses on Friday as data showing a decline in U.S. jobs growth was not expected to weigh much on the overall economic growth trajectory. A U.S. Labor Department showed nonfarm payrolls increased by 194,000 jobs last month, compared with expectation of 500,000. Although the headline number was a huge miss, analysts said besides the seasonally adjusted factors the number was not too disappointing.

After a knee-jerk move lower, the pan-European STOXX 600 index was back near last session's close. "Payrolls data came in weaker than expected, but the overall trend of an improving labor market remains intact," said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute.

While strong numbers could cement the case for the U.S. Federal Reserve's withdrawal of its support for the economy, many analysts expect that even a second straight weak employment report may not be enough to hold back the central bank from announcing a slowdown of its bond purchases later this year. "The Fed was hoping for a number large enough so that their decision to begin tapering last month would be an easy one. Now, the discussions on November 2-3 may be more difficult," said Carl Tannenbaum, chief economist, Northern Trust, Chicago.

Oil and auto stocks led gains in Europe, but this was offset by tech stocks falling 1.2% as rising bond yields dimmed the high-growth sector's appeal. The European stocks benchmark was on course for modest weekly gains as relief over a temporary lifting of the U.S. debt ceiling countered worries that soaring energy costs would push inflation higher.

UK travel stocks, including British-Airways owner IAG , Whitbread and Ryanair, gained between 0.2% and 2.8% after Britain was set to scrap tough COVID-19 quarantine requirements for 47 destinations. Czech trucking services firm Eurowag fell 12.0% in its London market debut after floating a day late and at a cut price.

Auto stocks rose 0.3%, rebounding from a selloff in September on concerns about supply chain bottlenecks and chip shortages hitting production. German carmaker Daimler rose 2.8% as UBS upgraded its stock to "buy" from "neutral" and hiked its price target to 100 euros from 79 euros.

Cnova NV, the e-commerce arm of French retailer Casino, fell 5.5% after saying it could no longer confirm its June financial forecast due to challenging third-quarter business conditions. London-listed shares of TUI AG sank 15.2% on the first day of a discounted rights issue.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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