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by Andre Janse van Vuuren and Julien Ponthus
Stocks and bonds nudged higher as traders stepped up wagers on a faster pace of interest-rate cuts by the Federal Reserve.
S&P 500 futures rose 0.1% ahead of Friday’s pivotal jobs report. Treasuries posted small gains, with the yield on 10-year debt falling one basis point to 4.20%. The dollar traded flat.
The advances were stronger in Europe, where the Stoxx 600 strengthened 0.2% and bonds rose almost across the board. A selloff in Chinese stocks deepened on a Bloomberg report that regulators may move to cool a rally that has added $1.2 trillion since August.
Traders are tempering their moves after days of shifts in stocks and bonds that were driven by worries over stretched valuations and government finances. As data continue to highlight softness in the labor market, swaps show traders are nearly fully pricing in a quarter-point rate cut this month and broadly split on the likelihood of another in October.
Until Wednesday, most traders only saw a second cut in December.
“September’s cut is a given but we don’t have any strong convictions going forward,” said Fabien Benchetrit, head of target allocation for France and southern Europe at BNP Paribas Asset Management. “As for equities, we’re on the lookout for opportunities and we would look for a temporary weakness to reinforce our positions.”
Economists project about 75,000 jobs were added in August, based on the median of a Bloomberg survey, while the jobless rate is seen at 4.3%. Four straight months of sub-100,000 payrolls growth would mark the weakest such stretch since the onset of the pandemic in 2020.
In commodities, oil dropped for a second day as traders fretted that OPEC+ may boost supplies and an industry estimate showed higher stockpiles at a key storage hub. Global benchmark Brent fell below $67 a barrel, while West Texas Intermediate moved toward $63.
- DeepSeek is developing an artificial intelligence model with more advanced AI agent features to compete with US rivals like OpenAI in a newer frontier of the technology, Bloomberg News has reported.
- Sanofi’s experimental drug for the skin condition atopic dermatitis disappointed investors in a late stage trial, after the benefit of the drug was less than expected. The stock fell.
- Tesla Inc. said it has opened its robotaxi app to the general public, suggesting the company will soon roll out the service beyond a select group of early access users in Austin, Texas.
- Apple Inc. is planning to launch its own artificial intelligence-powered web search tool next year, stepping up competition with OpenAI and Perplexity AI Inc.
- Salesforce Inc. projected lackluster quarterly sales growth, suggesting its artificial intelligence product isn’t yet paying off as quickly as hoped in the face of competition from emerging AI companies.
- Hewlett Packard Enterprise Co. Chief Executive Officer Antonio Neri said the company expects to weather a slimming of profit margins as it enters a new era of artificial intelligence-driven demand.
Some of the main moves in markets:
- The Stoxx Europe 600 rose 0.3% as of 9:32 a.m. London time
- S&P 500 futures rose 0.1%
- Nasdaq 100 futures rose 0.2%
- Futures on the Dow Jones Industrial Average were little changed
- The MSCI Asia Pacific Index rose 0.2%
- The MSCI Emerging Markets Index fell 0.4%
Currencies
- The Bloomberg Dollar Spot Index was little changed
- The euro was little changed at $1.1653
- The Japanese yen fell 0.2% to 148.37 per dollar
- The offshore yuan was little changed at 7.1393 per dollar
- The British pound was unchanged at $1.3444
Cryptocurrencies
- Bitcoin fell 1.3% to $110,779.51
- Ether fell 1.8% to $4,388.1
Bonds
- The yield on 10-year Treasuries declined one basis point to 4.20%
- Germany’s 10-year yield declined two basis points to 2.72%
- Britain’s 10-year yield declined one basis point to 4.73%
Commodities
- Brent crude fell 0.5% to $67.26 a barrel
- Spot gold fell 0.4% to $3,544.21 an ounce
This story was produced with the assistance of Bloomberg Automation.
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