Investors overlook the high infection rates, taking the view that, overall, the situation is still improving supported by week featuring strong data.
The market rally fuelled by record U.S. job growth had largely stalled amid US high infection rates by COVID-19. However, the fastest expansion in China’s services sector in over a decade and more stimulus ensured optimism remained.
The United States reported more than 55,000 new COVID-19 cases on Thursday, the largest daily increase any country has ever reported. More than three dozen U.S. states saw increases in COVID-19 cases. The surge of new coronavirus infections prompts U.S. states to delay or even reverse plans to let activities resume.
U.S. nonfarm payrolls surged by 4.8 million jobs in June, above the average forecast of 3 million jobs in June. The record job growth is thanks to rises in the hard-hit hospitality sectors.
Τhe ECB’s expansion of its pandemic-related bond purchases programme probably boosted IHS Markit’s final PMI, a good gauge of economic health. The index bounced to 48.5 in June from May’s 31.9, better than a 47.5 preliminary reading.
Activity in the bloc’s dominant service industry also almost returned to growth last month. Its PMI soared to 48.3 from 30.5, comfortably ahead of the 47.3 flash reading.
However, unemployment in the bloc edged up in May, official data showed on Thursday.
A new French prime minister will be named in the next few hours as President Emmanuel Macron readies a reshuffle. Prime Minister Edouard Philippe resigned earlier on Friday, a formal first step in any cabinet revamp.
START TRADINGForex – High infection rates add to market nerves
Currency and commodity markets also had a subdued feel after an otherwise strong week. Currency traders’ risk appetite was boosted only slightly by better-than-expected jobs data in the United States. U.S. markets are shut on Friday. Along with no significant data releases, analysts expect a quiet day.
Against a basket of currencies, the dollar rose slightly in early London trading. The greenback was up less than 0.1% at 97.306. It is still firmly on track for its biggest weekly fall since the first week of June.
Riskier currencies edged up, with the New Zealand dollar up 0.1% at 0.6519 versus the U.S. dollar. The Australian dollar was up 0.1% at 0.6932.
The euro was down at $1.1226 and it gained against the safe Swiss franc.
Sterling was headed for its first positive week in four against the dollar on Friday. The British currency held close to the $1.25 mark as a week of EU-Britain negotiations ended on what investors called an optimistic note. Traders expect meetings to resume next week.
Brexit talks this week between Britain and the EU ended early on Thursday. A meeting between the chief negotiators on Friday cancelled.
By 0817 GMT, the pound was trading flat to the dollar at $1.2464.
Against the euro, it was down 0.06% at 90.16 pence. Sterling has risen 1.2% against the dollar this month, after losing 2.7% in June.
In commodity markets, oil prices also eased after an otherwise solid week.
Brent crude fell 0.65% to $42.86 a barrel while U.S. crude dropped 0.66% to $40.38 a barrel. Both were around $25 this time two months ago.
PLEASE NOTE The information above is not investment advice.
Sources: Reuters, Investing, CNN money