Investors await key U.S. payrolls report while Tesla recovers 5% premarket after public feud between Elon Musk and Donald Trump.
Global stock markets were quiet on Friday as investors waited for crucial U.S. jobs numbers that could influence future economic decisions. Meanwhile, Tesla shares began to recover in pre-market trading, regaining some ground after a sharp drop triggered by a public clash between President Donald Trump and Elon Musk.
Recent weak economic signals have increased fears that the upcoming payroll data might disappoint. A poor report could raise concerns of stagflation and pressure the Federal Reserve to lower interest rates sooner than expected.
Investors are also watching whether a phone call between Trump and Chinese President Xi Jinping on Thursday could lead to new trade talks. Any progress might ease tensions between the two economic powers and lift market sentiment.
“That’s probably going to be the number one thing for markets in reality,”
said Jason da Silva, Global Investment Strategy Director at a private firm, suggesting that any breakthrough could spark a rally after months of uncertainty.
Tesla Recovers After Sharp Fall
Tesla (TSLA.O) shares rose 5% in pre-market U.S. trading and gained 4% in Frankfurt, following reports of a scheduled call between Musk and Trump.
This followed a steep 14% drop in Tesla’s stock, wiping out $150 billion in value. The fall came after Trump warned he might cut government contracts to Musk’s companies, as their relationship turned from close to openly hostile.
Stocks Mixed Across the Globe
European stocks were mostly flat, mirroring quiet trading in Asia. However, Nasdaq futures and S&P 500 futures both increased by about 0.4%, showing some positive momentum.
In the currency markets, the euro stayed close to six-week highs against the dollar, after the European Central Bank cut interest rates as expected but signaled it might pause further cuts for now.
The euro dipped 0.2% on Friday to $1.1424 due to weak German export data, but it’s still on track for a 0.7% gain this week.
The chance of another ECB rate cut in July now stands at around 18%, down from 30% before Thursday’s press conference by the ECB President.
The ECB should stop cutting interest rates at every meeting and instead keep its powder dry given an uncertain economic outlook,
said Martins Kazaks, an ECB policymaker.
The U.S. dollar edged up 0.3% against other major currencies but remained near a six-week low.
Focus Shifts to U.S. Payrolls Report
This week’s labor data has raised red flags. There was a 47% year-on-year increase in layoffs, and the ADP private payrolls report came in far below expectations, lowering hopes for a strong jobs release.
Forecasts suggest an increase of 130,000 jobs in May, with the unemployment rate steady at 4.2%.
A weak result could prompt the Fed to consider rate cuts sooner, likely triggering a rally in U.S. Treasuries. Currently, futures markets suggest about a 76% chance of a rate cut by September.
Commodities Steady to Higher
Oil prices remained flat but are set for weekly gains due to ongoing supply concerns. U.S. crude futures were last seen at $63.36 per barrel.
Gold rose 0.3%, trading at $3,363 an ounce as investors stayed cautious.
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