Global stocks edged higher on Friday as markets remained on alert over escalating tensions in the Middle East and awaited the release of critical U.S. jobs data. Oil prices surged, marking their biggest weekly gain in two years, driven by heightened geopolitical risks.
Focus on U.S. Jobs Data as Rate Cut Bets Ease
With the U.S. nonfarm payrolls report due shortly, investors remained cautious in their trading positions. This jobs data is expected to influence the Federal Reserve’s next monetary policy move, with traders already pulling back on expectations of a significant interest rate cut in November.
Hong Kong stocks rallied on optimism surrounding China’s new stimulus measures, and futures for the S&P 500 and Nasdaq both rose 0.1%, suggesting a modest rise for U.S. stocks later in the day.
Oil Prices Surge Amid Middle East Tensions
Oil prices jumped 8.6% this week, the largest weekly increase since October 2022, as concerns over disruptions to global crude supply grew. Tensions escalated after U.S. President Joe Biden mentioned possible strikes on Iranian oil facilities in response to Tehran’s missile attack on Israel. Brent crude rose 0.7% to $78.17 a barrel, and U.S. futures climbed 0.7% to $74.24.
Equities and Currencies Trade Cautiously
Equities traded with caution, with the MSCI All-World index rising 0.1% and Europe’s STOXX 600 gaining 0.2%. In Asia, Japan’s Nikkei rose 0.2% but was still set for a weekly loss of around 3% due to mixed reactions to geopolitical concerns and domestic monetary policy.
Japan’s currency, the yen, rose 0.45% on Friday to 146.29 per dollar, despite being down 2.8% for the week. Prime Minister Shigeru Ishiba’s recent comments hinting at no further rate hikes by the Bank of Japan added volatility to the yen.
U.S. Ports Reopen After Labor Deal, Shipping Stocks Hit
U.S. East Coast and Gulf Coast ports reopened Thursday night following a major wage deal that ended the region’s largest dockworker strike in 50 years. Shares of shipping companies in Asia and Europe declined on expectations that freight charges, which spiked during the strike, would now trend downward.
Economic Resilience and Currency Movements
Ahead of the U.S. payrolls data, the dollar remained strong, hovering near a six-week high. Economists expect 140,000 new jobs to be added in September, a slight decrease from the 142,000 reported in August. Meanwhile, the euro stayed flat at $1.1028, with a weekly drop of 1.2%, while sterling rose 0.2% to $1.3159 following cautious comments from Bank of England Chief Economist Huw Pill.
Spot Gold Holds Steady
In commodities, spot gold rose 0.34% to $2,665.15 an ounce, as investors weighed geopolitical tensions and economic data.
