European Markets Gain Ground: US Employment Data Takes Center Stage

European stock markets show signs of recovery, largely due to diminishing concerns over high interest rates. Yet, the focal point remains the impending US non-farm employment data. This crucial statistic is anticipated to offer clear insights into the Federal Reserve’s potential interest rate move in November.

European stock markets have been critical in recent days. Particularly in the United States, non-farm employment data to be announced today creates great uncertainty, considering the volatility in the market. However, European stock markets are following a positive trend as concerns about rising interest rates ease.

The STOXX 600 index was positive for the second consecutive trading day with an increase of 0.4% this week, but even after this rise, it is possible that the index will complete the third week in negative.

Earlier in the week, the STOXX index fell to its lowest level of the year (due to the expectation that interest rates will remain at higher levels for a long time) with the increase in US and European government bond yields.

Non-Farm Employment Data May Be a Harbinger in Forecasting Interest Rates

Perhaps the most critical event of this week is the decision that the US Federal Reserve (Fed) will make on whether to increase interest rates in November. (The decision is announced on the first Friday of each month).

It is believed that a decisive factor in this decision will be the non-agricultural employment data to be announced today.

However, in addition to this activity in the stock markets, the process is very difficult for some companies. For example, Amsterdam-based Philips received a negative review from the US Food and Drug Administration (FDA) regarding its product recall. Philips had decided to recall millions of respirators since last year, and this process caused a 9.6% decline in the company’s shares.

However, although the recovery in European stock markets seems to have a positive impact on investors, US economic data and the difficulties faced by some large companies indicate that uncertainty continues in global markets.

Source: Reuters

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