Stocks Mixed Ahead of US Jobs Report; Oil Rises: Markets Wrap

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(Bloomberg) — Stocks were mixed Friday and global bonds slumped into their first bear market in a generation ahead of key US jobs data that could stir expectations for another sharp Federal Reserve interest-rate hike.

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Europe’s Stoxx 600 index rose, while US futures fluctuated. Asian shares fell.

The jobs update Friday is expected to show healthy payrolls growth and follows a stronger-than-expected US manufacturing report. Traders increasingly anticipate another large 75 basis points Fed rate rise to cool inflation.

Concerns that rising rates will hurt growth has weighed on bonds, pushing the Bloomberg Global Aggregate Total Return Index of government and investment-grade corporate bonds down more than 20% from a 2021 peak.

A dollar gauge held near a record high and the euro strengthened.

Oil rose to pare a hefty weekly decline before an OPEC+ meeting on supply. Russia looks set to resume gas supplies through its key pipeline, a relief for investors even as fears persist about more halts this winter.

A gauge of world shares is set for its worst week since June, roiled by ebbing bets on tempered Fed tightening after US central bank officials made it clear that they see the need for restrictive monetary settings for some time.

“We don’t have a lot of reasons to be bullish in this type of environment for the next couple of weeks and months,” Meera Pandit, global market strategist at JPMorgan Asset Management, said on Bloomberg Television. “Yet when we think about the longer term perspective and the longer term investor, these are the types of level that can be fruitful in the long run.”

The payrolls report later Friday is projected to show a 298,000 gain and solid wage growth. Federal Reserve Bank of Atlanta President Raphael Bostic said there’s still some work to do to contain price pressures.

Gold struggled to hold above $1,700 an ounce. Bitcoin was near $20,000.

Here are some key events to watch this week:

  • ECB Governing Council members due to speak at event Tuesday through Sept. 2

  • US nonfarm payrolls, Friday

  • UK leadership ballot closes Friday. Winner announced Sept. 5

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Some of the main moves in markets:

Stocks

  • The Stoxx Europe 600 rose 0.5% as of 8:10 a.m. London time

  • Futures on the S&P 500 fell 0.1%

  • Futures on the Nasdaq 100 fell 0.1%

  • Futures on the Dow Jones Industrial Average fell 0.2%

  • The MSCI Asia Pacific Index fell 2.2%

  • The MSCI Emerging Markets Index fell 1.8%

Currencies

  • The Bloomberg Dollar Spot Index was little changed

  • The euro rose 0.3% to $0.9975

  • The Japanese yen was little changed at 140.24 per dollar

  • The offshore yuan was little changed at 6.9099 per dollar

  • The British pound was little changed at $1.1552

Bonds

  • The yield on 10-year Treasuries declined one basis point to 3.24%

  • Germany’s 10-year yield was little changed at 1.56%

  • Britain’s 10-year yield was little changed at 2.89%

Commodities

  • Brent crude rose 1.9% to $94.07 a barrel

  • Spot gold rose 0.2% to $1,701.46 an ounce

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