Lower call with US jobless claims in focus

(Alliance News) - Stocks in London were set to open lower on Thursday, ahead of the US weekly unemployment claims report, which will help provide further insight into the health of the US economy.

IG says futures indicate the FTSE 100 index of large-caps to open 15.82 points lower, or 0.2%, at 7,914.10 on Thursday. The FTSE 100 closed up 10.44 points, 0.1%, at 7,929.92 on Wednesday.

Sterling was quoted at USD1.1854 early on Thursday, flat on USD1.1859 at the London equities close on Wednesday.

"Today, investors will mostly spend the session digesting Powell's hawkish testimony, the major shift in US rate expectations, and the strong jobs data. They will also watch the US weekly jobless claims and pray that the February [nonfarm payrolls] print [on Friday] doesn't surprise to the upside as did the ADP report," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

The US labour market remained strong last month, figures from payroll processing firm ADP showed on Wednesday, strengthening the case for faster interest rate hikes.

According to ADP, the US private sector added 242,000 jobs in February, topping FXStreet-cited expectations of a rise of 200,000. In January, 119,000 jobs were added, upwardly revised from 106,000.

Wall Street ended mostly higher on Wednesday, with the Dow Jones Industrial Average ending down 0.2%, the S&P 500 up 0.1% and the Nasdaq Composite up 0.4%.

The euro traded at USD1.0549 early on Thursday, flat on USD1.0553 late Wednesday.

European Central Bank President Christine Lagarde said Wednesday she will do whatever it takes to bring down high inflation and restore price stability.

Speaking at the World Trade Organization in Geneva, Lagarde said the ECB will spare no efforts to combat the inflation lashing most of the countries in the eurozone.

"We will restore that price stability and we will do whatever it takes," she said.

Against the yen, the dollar was quoted at JPY136.74, lower versus JPY137.14.

Japan's economic growth at the end of 2022 was weaker than initially estimated, official figures showed.

According to the Cabinet Office, Japan's gross domestic product rose by just 0.1% annually in October from December, revised downwards from an initial estimate of 0.6%.

Compared to the previous quarter, growth was virtually flat, versus a previous estimate of 0.2% growth.

In Tokyo on Thursday, the Nikkei 225 index was up 0.6%. In China, the Shanghai Composite was down 0.1%, while the Hang Seng index in Hong Kong was up 0.1%. The S&P/ASX 200 in Sydney closed flat.

China's consumer price inflation last month fell to its lowest level in a year, as the country emerged from strict pandemic controls and a Lunar New Year spending binge.

February's consumer price index – the main gauge of inflation – rose 1.0%, slowing from a 2.1% annual rise in the first month of the year, according to the country's National Bureau of Statistics.

The latest figure is the lowest since February 2022. While a slowdown in price rises was expected, FXStreet-cited consensus had predicted annual inflation at 1.9%.

Brent oil was trading at USD82.65 a barrel early Thursday, flat on USD82.60 late Wednesday. Gold was quoted at USD1,813.31 an ounce, lower than USD1,818.62.

In Thursday's corporate calendar, there are full-year results from Aviva, Entain, M&G and Spirax-Sarco.

In the economic calendar, US President Joe Biden will announce his budget for the 2024 financial year.

By Heather Rydings, Alliance News senior economics reporter

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