Global equity markets and the dollar edged higher yesterday, helped by fresh data showing a tighter US labour market, as investors stayed cautious before the first meeting between US President Donald Trump and his Chinese counterpart Xi Jinping.
Key stock indexes in Europe and on Wall Street climbed but a gauge of global equities was little changed, with gains offset by a decline in emerging markets.
The dollar index extended gains after data showed new applications last week for US unemployment benefits recorded their biggest drop in nearly two years.
Last week’s jobless claims data, however, has little bearing on the March employment report due out today. Claims rose during the survey week for nonfarm payrolls last month, suggesting some moderation in the pace of job growth.
“The market will be very remiss to do anything too sharp at this point, given that we have payrolls coming up,” said Gennadiy Goldberg from TD Securities.
The dollar index rose 0.1 per cent, with the euro down 0.11 per cent at $1.065. The Japanese yen eased 0.27 per cent versus the greenback at 111.03 per dollar.
Mr Trump faces pressure to deliver trade concessions with China for some of his most fervent supporters and to prevent a crisis with North Korea from spiralling out of control. However, White House officials have set expectations low for the meeting.
The market’s main concern is that Mr Trump and Mr Xi may not see eye-to-eye on most things and that traders will infer this from their body language, said Thierry Albert Wizman, global interest rates and currencies strategist, at Macquarie Group in New York.
“Rather than a lack of agreement, however, the greater risk is a lack of deep engagement,” he said.
On Wall Street, the Dow Jones Industrial Average rose 54.07 points, or 0.26 per cent, to 20,702.22. The S&P 500 gained 7.27 points, or 0.31 per cent, to 2,360.22 and the Nasdaq Composite added 19.07 points, or 0.33 per cent, to 5,883.55.
The pan-European FTSEurofirst 300 index closed up 0.20 per cent to a provisional 1,500.65, while MSCI’s gauge of stocks across the globe fell 0.01 per cent.
Oil prices rose nearly one per cent, on track for a fourth straight day of gains, but analysts warned record high US inventories could derail the rally.
US crude rose 42 cents to $51.57 a barrel and Brent was last at $54.71, up 35 cents on the day.
US Energy Department data shows crude inventories at record levels, saying speculative buying is starting to reach dangerous levels from a technical perspective.
Gold edged lower, pressured by a firmer dollar, while copper also fell. US gold futures gained 0.36 per cent to $1,253.00 an ounce. Copper lost 0.65 per cent to $5,856.50 a tonne.