LONDON — European stock markets are set to open higher on Friday, as investors await a key U.S. jobs report that’s likely to set expectations for an upcoming Federal Reserve interest rate cut.
Major bourses are all seen opening higher, according to IG data.
Both equities and bonds sold off globally earlier in the week amid fears over governments’ high debt loads and fiscal plans, particularly as the White House scrambled to protect its new tariff revenues.
However, sentiment brightened on Thursday as U.S. payrolls data boosted market bets on a Fed rate cut in September but did not stoke fears of a severe economic downturn. CME’s FedWatch tool put a 99% probability on a September cut as of Friday morning.
All eyes are now on whether the Friday August jobs report will be another “Goldilocks” reading that shows the right amount of softness in the labor market to reinforce those expectations. Economists polled by Dow Jones are forecasting the addition of 75,000 jobs last month.
In Europe, U.K. retail sales data will provide a glimpse into the country’s economic health as it gears up for a November budget.
Shares of Orsted were seen opening lower after the Danish wind farm developer nudged its full-year earnings guidance to between 24 billion Danish kroner ($3.75 billion) and 27 billion Danish kroner, down from 25-28 billion Danish kroner, citing lower-than-normal offshore wind speeds across its offshore portfolio.
It comes with the company on Friday preparing to hold a shareholder meeting at which it will seek approval for the next stage in its $9.4 billion rights issue as it battles with political obstructions of its U.S. projects. On Thursday it was announced that Orsted was suing the Trump administration in a bid to restart construction on a blocked offshore wind farm in New England.
— CNBC’s Sarah Min contributed to this report.
