(Alliance News) - Stocks in London are set to open higher on Friday, as investors reflect on central bank decisions in the US and EU, and turn now US jobs data later in the day, while in the UK, local election results come in.
IG says futures indicate the FTSE 100 index of large-caps to open up 25.5 points, 0.3%, at 7,728.14 on Friday. The index closed down 85.73 points, or 1.1% at 7,702.64 on Thursday.
"Yesterday saw another negative session for markets in Europe, reversing all the modest rebound that we saw on Wednesday as well as a little more, with the FTSE 100 hitting a four-week low, and the DAX a three-week low," said CMC Markets' chief market analyst Michael Hewson.
Sterling was quoted at USD1.2605 early Friday, higher than USD1.2565 at the London equities close on Thursday.
The euro was stronger, following a 25 basis point interest rate hike from the European Central Bank on Thursday.
The single currency traded at USD1.1042 early Friday, higher than USD1.1002 late Thursday. Against the yen, the dollar was quoted at JPY133.95, unchanged from JPY133.94.
Investors in New York on Thursday continued to be spooked by developments in the banking sector, with the Dow Jones Industrial Average ending down 0.9%, the S&P 500 down 0.7% and the Nasdaq Composite down 0.5%.
Shares in PacWest fell 51% after the regional lender said it had been approached by potential partners and investors over a potential sale. Blue-chip banks also closed in the red.
On Friday afternoon, London time, there will be the latest US jobs print.
Nonfarm payrolls net additions are expected to slow to 179,000 from 236,000 in March, according to FXStreet.
"Having seen the Federal Reserve hike by another 25bps rate hike earlier this week, a strong number today would keep the prospect of another rate hike in June, although it would need to be a bumper number to do that," CMC's Hewson considered.
However, Hewson noted that increasingly investors are concluding the Federal Reserve has paused its current tightening cycle, and the real question is when rate cuts will begin.
In Asia on Friday, financial markets in Japan were closed for Children's Day. In China, the Shanghai Composite was down 0.5%, while the Hang Seng index in Hong Kong was up 0.6%. The S&P/ASX 200 in Sydney was up 0.3%.
Gold was quoted at USD2,048.23 an ounce early Friday, edging down from USD2,049.92 on Thursday. Brent oil fetched USD73.17 a barrel early, higher than USD72.38.
In Friday's UK corporate calendar, there will be first-quarter results from International Consolidated Airlines and a trading statement from InterContinental Hotels.
In the economic calendar, the eagerly-awaited US non-farm payrolls will be released at 1330 BST.
Before that, there are German factory orders at 0700 BST, a UK construction PMI at 0930 BST, and EU retail sales at 1000 BST.
Rishi Sunak's Tories were on course for heavy losses in the UK prime minister's first electoral test as Labour and the Liberal Democrats both made gains in elections across England.
Labour gained control of Plymouth, where the Tories had run a minority administration – a result branded "terrible" by government minister and local MP Johnny Mercer – then did the same in Stoke-on-Trent, another general election battleground.
In Hertsmere, where Deputy Prime Minister Oliver Dowden is MP, the Tories lost control of the council, with 13 councillors voted out while Labour gained seven and the Lib Dems six.
Tamworth, Brentford, North West Leicestershire and East Lindsey also fell from Tory administrations to no overall control. Labour replaced the Tories as the largest party in Hartlepool and Worcester.
About a quarter of the votes were being counted overnight, with the rest counted during the day on Friday.
By Elizabeth Winter, Alliance News senior markets reporter
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