Stocks in the US closed significantly higher on Friday, recovering some of the losses from the previous day, as investors digested stronger-than-expected labor data. The S&P 500 finished 1.1% higher, the Dow Jones advanced 318 points, and the Nasdaq gained 1.2%. The latest jobs report revealed the US economy added the most jobs in ten months, while the jobless rate unexpectedly edged lower from two-year highs and employers continued to lift wages at a steady pace. These figures suggest the labor market remains tight, boosting the chances of a soft landing for the US economy and potentially delaying the widely expected interest rate cuts amid mixed comments from Fed’s officials. Nvidia (+2.4%) and Amazon (+2.8%) were top performing mega cap stocks, while Tesla fell 3.6% after canceling its plans for a low-cost car that widely have been anticipated. For the week, the Dow Jones recorded a 1.9% loss, booking the worst week of 2024, while the S&P 500 and Nasdaq declined by 1% and 1.3%.
Frankfurt's DAX 40 closed 1.3% lower at 18,164. On the domestic data front, German factory orders increased by just 0.2% in February, missing expectations of 0.8% growth and following a sharp 11.4% decline the month before. Import prices were down by 0.2% month-over-month in the same period, also falling short of forecasts of a flat reading.
The FTSE 100 dropped 0.7% to 7920 .In corporate news, Shell predicted a significant drop in first quarter results for its LNG trading arm compared to the previous quarter. Experian's stock dipped following its acquisition of illion for up to A$820 million. Rio Tinto faced shareholder pressure over environmental issues, resulting in a 1% stock decline. For the week, the UK index went down 0.6%.
The CAC 40 fell 1.1% to close at 8,061. Most index heavyweights experienced losses, notably Pernod Ricard (-2.46%), STMicroelectronics (-2.37%), LVMH (-2.21%), L'Oréal (-2%), and AXA (-1.98%). The CAC 40 recorded a weekly decline of 1.76%.
The FTSE MIB retained its morning losses, dropping by 1.29% to close at 34,010 Notably, the prominent Italian financial sector took a hit, with major lenders like Intesa Sanpaolo and Unicredit leading the downturn, losing around 1.5% each. Banca Monte Paschi Siena also witnessed a 3% decrease. On the other hand, Eni stood out as one of the few companies in positive territory, with a 1% increase. This uptick came as Eni's board of directors proposed a buyback of 1.1 billion euros to the assembly, which could potentially be raised to 3.5 billion euros. Looking at the weekly performance, the FTSE registered a decline of 2.3%.
The IBEX 35 dropped by over 1.5% to 10,916. The energy sector was the largest drag, headed by Acciona Energia (-4.7%), Acciona (-4%), and Solaria Energia (-3.2%). Also, heavyweights Banco Santander (-1.9%) and Inditex (-1.8%) dropped, and banks mostly closed in the red despite a positive reevaluation from Morgan Stanley analysts. Meanwhile, Grifols lost the morning momentum and edged down by 0.3% despite providing more details on past EBITDA and leverage ratios. Among few values to escape punishment, Laboratorios Farma (1.1%), Repsol (0.5%) and Unicaja (0.5%) stood out. Repsol benefitted from elevated oil prices. Overall, the index ended the first week of Q2 with a fall of 1.4%.
