European Shares Seen Opening On Cautious Note Before US Jobs Data

(RTTNews) - European stocks may drift lower at open on Friday as investors await the U.S. Labour Department's closely watched monthly jobs report later in the day for more insight into the labor market and the outlook for monetary policy.

Market participants positioned themselves for a soft print after a swathe of weak readings released through the week signaled a potential shift towards stagflation —a combination of high inflation, slow economic growth and rising unemployment.

It is believed a sustained weakening in job growth or rising inflation will prompt the Federal Reserve to take more aggressive action in the months ahead.

U.S. stock futures inched higher after reports emerged that White House aides had organized a call between President Trump and Musk to attempt reconciliation.

Asian markets clung to modest losses due to prevailing uncertainty over the U.S. economy and Trump's trade policies.

Gold prices rose in Asian trade and headed for a weekly gain as the U.S. dollar faced a weekly loss.

Oil was slightly lower but headed for its first weekly gain in three as optimism over peak seasonal demand offset lingering concerns about oversupply.

Industrial production and foreign trade from Germany as well as house price data from the U.K. are due later in the session, headlining a busy day for the European economic news.

U.S. stocks fluctuated before ending in the red overnight as investors weighed potential progress in U.S.-China trade talks against another round of downbeat economic data.

China and the U.S. have agreed to more tariff talks amid a trade standoff and concerns over rare earths, President Donald Trump said Thursday after speaking to Xi Jinping over the phone.

In economic news, weekly jobless claims hit a seven-month high, while a record drop in imports resulted in the narrowest U.S. trade gap since November 2023.

Fed policymakers indicated on Thursday that inflation remains a greater concern than labor market cooling, suggesting a prolonged hold on monetary policy adjustments. The tech-heavy Nasdaq Composite fell 0.8 percent, the S&P 500 gave up half a percent and the narrowed Dow closed 0.3 percent lower.

Tesla shares plunged over 14 percent as Elon Musk and Trump's simmering feud devolved into a public war of words.

European stocks closed slightly higher on Thursday as the European Central Bank lowered its key rates by 25 basis points but hinted at a pause in its year-long easing.

The pan European STOXX 600 gained 0.2 percent. The German DAX rose 0.2 percent and the U.K.'s FTSE 100 inched up 0.1 percent, while France's CAC 40 eased 0.2 percent.