European bourses seen up
EUROPEAN OUTLOOK & US/ASIAN SUMMARIES:
Global stock markets overnight saw some selling pressure, although strategists hesitate to declare the recent uptrend over, especially with the pivotal U.S. labor data due Friday. For Thursday's opening, European bourses are likely to struggle a bit higher, with government debt mixed ahead of the European and U.K. central bank meetings. The euro is tipping a bit lower, with spot gold and oil futures seeing losses.
STOCKS:
European stock markets are likely to edge higher to start Thursday, clawing back previous losses. But sentiment remains highly cautious, with the fiscal problems in the euro zone shadowing the monetary meetings of the European Central Bank and Bank of England.
For Thursday's opening, IG Markets is calling the FTSE up 1 at 5254, the DAX up 13 at 5685 and the CAC up 5 at 3798.
"The market is mediocre, lacks fuel and is awaiting the U.S. employment figures for January," said Xavier de Villepion, a trader at Global Equities in Paris, adding that the stock market wasn't reacting to good company results.
"After posting two-straight sessions solidly higher, the equity markets are under some pressure," U.S. investment firm Charles Schwab & Co. said in a note.
"Traders may be booking some profits from the recent rally, treading cautiously ahead of Friday's labor report," it said.
Patrick O'Hare, chief market analyst at financial research group Briefing.com, said equities were in a "holding pattern" ahead of the crucial jobs data.
Worries about the state of the euro zone's peripheral countries also weigh on sentiment, as the cost of insuring Portuguese sovereign debt against default reached a record high. This came after the country sold fewer treasury bills than expected at an auction. Greece's five-year sovereign credit default swap spreads also widened significantly.
In the U.K., "It could be the case that we are in fact in the calm before the storm as the next couple of days promise to jump the volatility up a couple of notches with the BOE rate decision and Friday's U.S. jobs report," said James Hughes, market analyst at CMC Markets.
Wall Street futurs are mixed on Thursday, after markets treaded water on Wednesday as investors waited for Friday's full labor data.
They did garner some hope on the jobs front after a survey by U.S. payrolls firm ADP showed private-sector job losses narrowed to 22,000 in January, better than the consensus forecast of 30,000 and the smallest number of job cuts in two years.
"The payroll report was strong. Not only did payrolls decline by the least amount since February 2008, but payrolls are poised to turn positive within the next few months," analysts from Briefing.com said.
But there was disappointment too after the vast U.S. services sector posted anaemic growth in January, the first expansion in activity in three months, according to a closely watched private survey released Wednesday.
The Institute of Supply Management said its purchasing managers index registered 50.5% in January, barely above the 50% indicating expansion of activity and below the consensus forecast of 51.0%.
Asian stock markets are mostly lower Thursday as investors adopted a cautious stance ahead of the U.S. jobs report Friday and shares in Japan fell because of deepening concerns over Toyota Motor's recall of vehicles.
"We are consolidating after the bounce this week but the dust definitely needs to settle in regard to what's going in the U.S. in regard to bank regulations, Greece and China," said RBS Morgans Private Client Adviser Todd Kerslake in Sydney.
Australia's market was pulled down by weakness in materials stocks, which tracked their U.S. peers.
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February 04, 2010 01:00 ET (06:00 GMT)
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