Global markets up ahead of US jobs data

Beijing: Global stock markets were mostly higher on Friday ahead of a US jobs update amid worries about the health of banks under pressure from interest rate hikes. London, Frankfurt, Hong Kong and Wall Street futures advanced. Shanghai declined. Markets in Japan and South Korea were closed for holidays. Oil prices advanced. The US government was due to report April employment data that are expected to show a slowdown in job growth. Investors hope more signs the economy is weakening might prompt the Federal Reserve to call off possible additional rate hikes to cool inflation. “We estimate a slowdown in net job growth and tick up in the unemployment rate,” said Rubeela Farooqi of High Frequency Economics in a report.

In early trading, the FTSE 100 in London rose 0.4per cent to 7,733.23. The DAX in Frankfurt gained 0.3per cent to 15,785.07 and the CAC 40 in Paris added 0.4per cent to 7,368.51. On Wall Street, the future for the benchmark S and P 500 index was up 0.3per cent. That for the Dow Jones Industrial Average rose 0.1 per cent. On Thursday, the S and P 500 index lost 0.7 per cent as investors worried about the health of banks following three high-profile failures in the United States and one in Switzerland. The Dow dropped 0.9 per cent and the Nasdaq fell 0.5 per cent. Shares of PacWest Bancorp, a target of investor scrutiny, tumbled 50.6 per cent.

The bank said it was considering options and has been approached by potential partners and investors. Investors want to know steps authorities might take to “limit further contagion risks,” Yeap Jun Rong of IG said in a report. “Any inaction over the weekend could translate to a more downbeat risk environment to start next week.” In Asia, the Shanghai Composite Index lost 0.5 per cent to 3,334.50 while the Hang Seng in Hong Kong gained 0.5 per cent to 20,049.31. Sydney's S and P-ASX 200 rose 0.4 per cent to 7,220.00. India's Sensex sank 0.8per cent to 61,261.70. New Zealand and Southeast Asian markets declined. Rate hikes by the Fed and other central banks in Europe and Asia have put pressure on banks by causing the market prices of bonds on their books to decline. Investors worry depositors might pull money out of lenders that are thought to be troubled, worsening their financial pressures.