Markets Tread Water As US Jobs Data Fall Short

World stock markets were mostly lower Friday with investors unimpressed by key US jobs data coming in below expectations

London, (APP - UrduPoint / Pakistan Point News - 03rd Nov, 2017 ) :World stock markets were mostly lower Friday with investors unimpressed by key US jobs data coming in below expectations. The Dow had finished at a fresh record high Thursday after US President Donald Trump nominated Jerome Powell to lead the Federal Reserve and congressional Republicans unveiled their long-awaited tax-cutting plan.

But Friday saw Wall Street and other major indices drift, losing marginal early gains, after US employers added 261,000 net new posts as businesses reopened in the wake of Hurricanes Harvey and Irma for a rebound which came in some 40,000 jobs below what many economists had predicted.

Although the data showed the US jobless rate falling to its lowest level in 17 years the Dow dipped 0.1 percent just after the opening bell, pulling back from Thursday's record close. The broad-based S&P 500 also slipped 0.1 percent, while the tech-rich Nasdaq Composite Index rose slightly.

But US stocks remain near record levels after a run of solid economic data and earnings and in anticipation that Trump will win a major tax cut. London and Paris similarly crept just into negative territory while Frankfurt bucked the trend by edging barely ahead.

The jobs data showed US labour markets bouncing back from the storms that idled the energy hub of southeast Texas and forced millions of Floridians to flee their homes. With the jobless rate receding that was likely to sharpen debate among Federal Reserve policymakers who appear likely to raise the benchmark US interest rate next month despite doggedly low inflation which a vocal minority argues should keep the Fed on hold.

"Despite the fact that the US jobs report almost always provides significant market volatility, today's figures are unlikely to have a huge impact on whether the Fed will raise rates next month," said Joshua Mahony, market analyst at IG trading group.

- Apple cheer - On the corporate front Friday, shares in Apple rose 2.4 percent to $172.10 after the tech behemoth said profit rose 19 percent to $10.7 billion (9.2 billion euros), and predicted bumper sales for its 10th anniversary iPhone X.

Apple's latest smartphone was launched in more than 50 countries and territories, with lengthy overnight queues at stores worldwide. In Europe, London's benchmark FTSE 100 index lost 0.1 percent, as did the Paris CAC40, after an initial London fillip as traders cheered better-than-expected growth for the UK services sector.

Analysts said overall UK economic growth was set to have picked up pace in the fourth quarter on rising services, supporting the Bank of England's decision this week to raise its key interest rate for the first time in a decade and also helping sterling.

"The pound has managed to bounce back a little... after taking a plunge on Thursday when the Bank of England (BoE) delivered a so-called dovish rate rise," noted forex.com analyst Fawad Razaqzada.

The BoE on Thursday raised its key rate from a record-low 0.25 percent to 0.50 percent in a bid to combat high UK inflation. In France, Renault led the way in jumping 4.2 percent to 90.2 Euros after the French government reduced its stake in the car giant.

Back across the Atlantic, in announcing his choice for the new Fed chief, Trump said former investment banker Powell has the wisdom and intelligence to guide the world's largest economy. Analysts said choosing Powell allows Trump to put his own imprimatur on the central bank with a minimum of disruption. "Meet the new boss, mostly the same as the old boss," said a note from Barclays.