Euro tumbles after unexpected resignation of new French Prime Minister
Investing.com - European stock markets closed lower on Friday, as traders assessed the release of the latest U.S. jobs report, which is expected to have implications for upcoming Federal Reserve interest rate decisions.
The pan-European Stoxx 600 had fell by 0.2%. Meanwhile, the Dax in Germany declined 0.7%, France’s CAC 40 slipped 0.3%, and the FTSE 100 in the U.K. edged 0.1% lower.
The U.S. economy added fewer jobs than anticipated in August, offering a fresh indication of an easing in the American labor market that could bolster the case for the Federal Reserve to slash interest rates at its next policy meeting later this month.
Data from the Labor Department’s Bureau of Labor Statistics showed nonfarm payrolls came in at 22,000 last month, down from an upwardly revised level of 79,000 in July. Economists had estimated that the figure would stand at 75,000.
Analysts had suggested that a soft or even tepid reading could all but cement expectations of a Fed rate reduction at the central bank’s September 16-17 gathering.
Fed officials are facing pressures to both pillars of their mandate -- keeping price growth stable and promoting maximum employment -- although recent comments from policymakers have indicated that supporting the labor market may be their current priority. Cutting interest rates can help to spur spending by businesses and consumers, albeit at the risk of pushing up lingering inflation.
Separate labor market data earlier this week further bolstered wagers that the Fed will slash rates this month. Figures showed that private-sector hiring slowed last month, while new weekly claims for unemployment benefits inched up by more than anticipated -- both fresh indications of a possible cooling in the American jobs picture.
In individual stocks, shares in Hexagon surged after the Swedish group announced a $3.16 billion deal to sell its design and engineering division to U.S. firm Cadence Design. The transaction is anticipated to close in the first quarter of next year.
Meanwhile, Orsted shares closed higher after earlier declining as the Danish energy company brought down its operating outlook due to lower wind speeds than usual. Banking software name Temenos plunged after it announced the immediate departure of CEO Jean-Pierre Brulard.