European Shares Seen Lower As AI Bubble Fears Linger
European stocks are expected to open lower due to AI valuation concerns and interest-rate worries. The U.S. jobs report is delayed due to a government shutdown, affecting market sentiment. Asian markets fell, led by tech stocks. Morgan Stanley revised its interest rate forecast. Gold declined, oil prices fell, and U.S. stocks ended lower amid weak jobs data. European stocks rose slightly on Thursday, aided by Nvidia's earnings.
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European stocks are seen opening lower on Friday, with lingering concerns over stretched valuations in the artificial intelligence sector and interest-rate worries likely to weigh on sentiment.
The U.S. Bureau of Labor Statistics will not release the October jobs report as the 43-day federal government shutdown disrupted data collection.
Instead, it will release some of the October jobs data - most importantly the number of jobs that employers created last month - along with the full November jobs report on Dec. 16.
Closer home, flash purchasing managers' survey results from the euro area and the U.K will be in the spotlight later today.
Asian markets followed Wall Street lower, with tech stocks leading losses on AI jitters. After strong U.S. jobs growth, Morgan Stanley scrapped its forecast that the U.S. Federal Reserve would cut interest rates by a quarter-point at its December meeting.
Gold was set for a weekly decline while the dollar was largely steady. Oil prices fell more than 1 percent amid easing geopolitical tensions between Russia and Ukraine.
U.S. stocks gave up early gains to end sharply lower overnight as weak jobs data overshadowed post-Nvidia earnings euphoria.
The delayed jobs report showed the labour market added 119,000 jobs in September after a revised dip of 4,000 jobs in August.
Economists had expected employment to rise by 50,000 jobs compared to the addition of 22,000 jobs originally reported for the previous month.
The unemployment rate ticked up from 4.3 percent to 4.4 percent, its highest level since 2021, heightening uncertainty surrounding the strength of the U.S. economy and the rate outlook.
The tech-heavy Nasdaq Composite and the S&P 500 plunged 2.2 percent and 1.6 percent, respectively to hit over two-month lows while the Dow dipped 0.8 percent to a new one-month low.
European stocks snapped a five-day losing streak on Thursday as upbeat Q3 earnings and fourth-quarter guidance from Nvidia helped ease concerns about tech valuations.
The pan European Stoxx 600 rose 0.4 percent. The German DAX gained half a percent, France's CAC 40 added 0.3 percent and the U.K.'s FTSE 100 edged up by 0.2 percent.
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