US stocks snapped higher on Thursday as unemployment data eased recession concerns, while European and Asian equities struggled.
First-time claims for unemployment benefits dropped last week by more than expected to 2,33,000, according to Labour Department data.聽
鈥楾he key takeaway from the report is that the downturn in initial jobless claims 鈥� a leading indicator 鈥� is helping to quell recession concerns,鈥� said Briefing.com analyst Patrick O鈥橦are.
Data last Friday showing fewer US jobs created in July than expected triggered concern that the Federal Reserve had waited too long to begin cutting interest rates and the US聽economy聽could end up sliding into recession.
鈥楢ny data which suggests that the Fed isn鈥檛 behind the curve in regards to its likely rate-cut in September is welcomed news for investors,鈥� said eToro US investment analyst Bret Kenwell.
US recession fears, combined with a spike in the value of the yen following a rate hike last week, sent global equity markets plunging Monday.聽
Since then there have been rebounds and renewed losses as traders seek to weigh up the risks of recession in the United States, the world鈥檚 biggest聽economy.
In Europe, London and Paris were lower but Frankfurt was flat in afternoon deals Thursday, after Tokyo closed down 0.7 per cent.
The Japanese index had tumbled more than 12 per cent Monday before rocketing over 10 per cent Tuesday, largely because of wild swings in the yen against the dollar.聽
Investors are also closely tracking corporate earnings.
Warner Bros. Discovery鈥檚 share price plunged聽nine per cent at the start of trading Thursday after it reported a quarterly loss of almost $10 billion. Almost all of the loss was down to a $9.1 billion write-down in the value of the US media giant鈥檚 cable network, it announced in a statement, underscoring the challenges facing the legacy television industry.聽
Weak earnings from Disney, Airbnb and TripAdvisor added to the sense of concern that American consumers were tightening their belts as the impact of elevated inflation and two-decade-high borrowing costs bite.
Federal Reserve boss Jerome Powell last week indicated that the US central bank could cut interest rates at its September meeting, with 25 basis points seen as the likely move.
But traders are now eyeing as many as 50 points, with another 50 possibly before the end of the year, following last weeks jobs data.
The prospect of several reductions has been offset by profit-taking in the tech sector, whose valuation has soared this year on a rush for all things related to artificial intelligence.
In foreign exchange Thursday, the yen rose against the dollar after tumbling Wednesday in reaction to a dovish signal from the Bank of Japan that its recent rate-hikes would not be repeated while markets remained volatile.
