Global markets lower after Wall Street gains on jobs data

Source: Reuters

Global stock markets and Wall Street futures fell Friday after unexpectedly good U.S. jobs data left room for more interest rate hikes to cool inflation.

London, Shanghai, Tokyo and Frankfurt declined. Oil prices edged lower but stayed above $90 per barrel.

Fewer Americans than expected filed unemployment claims last week, the Labor Department reported Thursday. That might reinforce sentiment at the Federal Reserve that the world's biggest economy can tolerate more rate hikes to cool inflation, which is running at multi-decade highs, without derailing growth.

That might keep the door open for aggressive Fed tightening, Edward Moya of Oanda said in a report.

In early trading, the FTSE 100 in London fell 0.4% to 7,513.45 and Frankfurts DAX lost 0.5% to 13,623.81. The CAC 40 in Paris shed 0.3% to 6,536.65.

On Wall Street, the future for the benchmark S&P 500 index was off 0.6%. That for the Dow Jones Industrial Average lost 0.4%.

On Thursday, the S&P 500 rose 0.2%. The Dow gained 0.1% and the Nasdaq composite added 0.2%.

In Asia, the Shanghai Composite Index lost 0.6% to 3,258.08 and the Nikkei 225 in Tokyo shed less than 0.1% to 28,930.33. The Hang Seng in Hong Kong added 0.4% to 19,838.10.

The Kospi in Seoul shed 0.5% to 2,495.03 while Sydneys S&P-ASX 200 lost less than 0.1% to 7,110.40.

Indias Sensex lost 1% to 59,701.73. New Zealand and Southeast Asian markets retreated.

Investors looked ahead to the Feds annual Jackson Hole conference in Wyoming next week for indications of when and how much the U.S. central bank might raise rates.

Minutes of the Feds July meeting released this week said inflation still is too high and made clear the central bank will keep raising interest rates.

The Fed has raised interest rates twice this year by 0.75 percentage points, triple its usual margin. Forecasters expect a hike at the board's September meeting, but say pressure for a similarly large increase has declined as economic growth cooled.

Data on Wednesday showed July retail sales held steady with the previous month despite concern inflation might depress consumers willingness to spend.

In energy markets, benchmark U.S. crude lost 95 cents to $89.55 38 per barrel in electronic trading on the New York Mercantile Exchange. The contract surged $2.39 to $90.50 on Thursday. Brent Crude, the price basis for international trading, fell 94 cents to $95.64 per barrel in London. It jumped $2.94 the previous day to $96.59.

The dollar rose to 136.49 yen from Thursdays 135.91 yen. The euro fell to $1.0078 from $1.0091.