Apple Results, Jobs Report to Steer Markets -- Update
November 03 2017 - 5:13AM
Dow Jones News
By David Hodari, Riva Gold and Lucy Craymer
-- Investors await jobs report
-- Pound steadies after biggest fall since June
-- Apple jumps in after-hours trading
Technology stocks were mostly higher Friday after Apple reported
better-than-expected results, although wider equity indexes were
little changed ahead of the U.S. jobs report due later in the
day.
The Stoxx Europe 600 edged up 0.1% in early-day trading after
five consecutive days of gains. S&P 500 futures were up less
than 0.1%. That followed torpid trading in Asia, with only
Australian and Chinese stocks making noteworthy moves.
Nasdaq-100 futures were up 0.3% and global technology companies
modestly outperformed after Apple said late Thursday that it
delivered its best quarterly growth in two years. Apple shares
jumped in after-hours trading, and a close above $174.24 on Friday
would take its market value over $900 billion for the first
time.
Apple shares have climbed around 45% so far in 2017, playing a
large role in this year's rally in U.S. stocks.
In Europe, shares of chip-gear firm ASML Holding rose 0.8%, chip
maker Infineon Technologies rose 1.5% and semiconductor maker
STMicroelectronics rose 1.6%. Taiwanese technology companies also
moved higher, with shares of Largan Precision up 3.6% and Hon Hai
Precision Industry up 0.4%.
Meanwhile, shares of Renault rose 5.2%, with the auto sector the
best performer in Europe, after the French government said it was
selling part of its stake in the company. That helped offset
declines in the banking sector, with shares of Société Générale
down 3.5% after it said its third-quarter profit fell
significantly.
Spain's IBEX 35 index fell 0.7% but remained on track for weekly
gains. A prosecutor asked a Spanish court on Thursday to issue an
arrest warrant for Carles Puigdemont, the leader of Catalonia's
secessionist movement who fled to Belgium to escape authorities in
Spain.
Investors across the globe were braced for the U.S. nonfarm
payrolls report, due before the U.S. market open. The report is a
key indicator of the strength of the economy and a strong showing
would help smooth the way for the Federal Reserve to raise interest
rates when it meets Dec. 13.
Economists surveyed by The Wall Street Journal predicted 315,000
jobs were created in October. After September numbers that showed
the first monthly drop in seven years--attributed to the hurricane
effect--"expectations are quite high" for the October reading, said
OM Financial client adviser, Stuart Ive.
The British pound edged down 0.1% to $1.3045 after its biggest
daily decline since June, helping lift the export-heavy FTSE 100
index another 0.3% Friday. The Bank of England on Thursday raised
interest rates for the first time in more than 10 years but
signaled that further increases weren't imminent, causing the pound
to slump 1.4% against the U.S. dollar.
"More important than the decision were the comments during the
press conference and inflation report, which were quite dovish,"
said Markus Stadlmann, chief investment officer at Lloyds Banking
Group. "There are so many moving parts with regards to the economic
situation for the U.K. at the moment that for investors, we have to
take it step by step."
The WSJ Dollar Index, which weighs the U.S. currency against a
basket of 16 others, ticked 0.1% higher as investors continued to
parse the details of a Republican tax bill and the nomination of
Fed governor Jerome Powell to be the next chairman of the central
bank.
The Dow industrials fell more than 80 points Thursday after a
detailed summary of the tax plan was reported, but the blue-chip
index climbed later in the session to end higher.
"We think tax reform is more likely than the market thinks it
is," said Jon Adams, investment strategist with BMO Global Asset
Management, noting expectations for a tax cut in 2018 are one of
the reasons for the asset manager's modest preference for equities
over bonds.
"This is a very fluid process and it's likely that there will be
a lot of change to what is currently being proposed," he added.
U.S. 10-year government bond yields edged up to 2.351% from
2.347% Thursday. German 10-year government bond yields edged down
to 0.360% from 0.367%. Yields move inversely to prices.
Asia-Pacific equities were little changed ahead of the U.S. jobs
report, with Japanese markets closed for a holiday.
Chinese tech giant Tencent rose 1.6% to a fresh record after
peer Alibaba reported positive quarterly results. The gain helped
Hong Kong's Hang Seng Index--of which Tencent is the largest
component--rise 0.3%.
Australia's S&P/ASX 200 gained 0.5% to finish at its highest
since April 2015 as commodity-price gains lifted materials and
mining companies. Steel and key steel ingredient iron ore were
among the leaders in this week's metals rebound, while nickel has
been a standout over the past month, jumping 23% on expectations
that rising demand from electric-vehicle producers will tighten
supplies.
Investors in the region were also looking ahead to President
Donald Trump's extended trip there, starting Sunday in Japan.
Write to David Hodari at David.Hodari@dowjones.com, Riva Gold at
riva.gold@wsj.com and Lucy Craymer at Lucy.Craymer@wsj.com
(END) Dow Jones Newswires
November 03, 2017 05:58 ET (09:58 GMT)
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