Amid rising European and Japanese indices

Most global stock indices rose on Thursday after gains in US technology stocks helped stabilize Wall Street, while a weaker dollar made Asian assets more attractive. US stocks were mixed following data showing weakness in the labor market, boosting investors’ hopes for a resumption of Federal Reserve rate cuts this month.

The Dow Jones Industrial Average rose 0.1%, the S&P 500 increased by 0.2%, and the Nasdaq Composite gained 0.43%.

ADP data showed the US private sector added 54,000 jobs in August, below the expected 75,000, raising concerns about labor market weakness.

Investors await the nonfarm payrolls report on Friday, with expectations of 75,000 new jobs added in August and an unemployment rate rising to 4.3%.

Currently, investors see a 97.6% probability of a 25 basis point US interest rate cut this month, up from 86.7% a week ago, according to the CME FedWatch tool.

Jamie Cox, managing partner at Harris Financial Group, said the Fed’s influence on the labor market has ended. He added that ADP data continues to support the narrative that the positive change rate in the labor market has slowed significantly, so the Fed is expected to tilt the risk balance toward cutting rates in September.

Stock Fluctuations

European stocks were steady as investors hesitated amid bond market concerns, while weak forecasts from British low-cost airline Jet2 affected the travel and leisure sector.

The Stoxx 600 rose 0.24%, Germany’s DAX gained 0.29%, and the UK’s Financial Times index increased by 0.1%, while France’s CAC fell 0.35% and Italy’s FTSE dropped 0.1%. The travel and leisure sector index declined 1.2%, with shares of Germany’s TUI and EasyJet falling over 4% each.

Jet2’s shares lost a quarter of their value after the company forecasted full-year operating profits near the low end of expectations.

Porsche shares fell nearly 1%, as the luxury carmaker is expected to be removed from the German mid-cap index following recent losses due to US tariffs and weak demand in China, one of its key markets.

Caution prevailed amid renewed concerns about debt-funded government spending in advanced markets this week, causing volatility in European stocks and longer-dated bonds.

Markets are assessing eurozone retail sales data and the final reading of GDP changes in the currency bloc for Q2 on Friday.

Recovery and Gains

Japan’s Nikkei index recovered from its lowest level in nearly a month recorded in the previous session, led by gains in local technology stocks following strong US tech gains the night before. The Nikkei closed up 1.5% at 42,580.27 points, after hitting its lowest close since August 8 on Wednesday.

SoftBank Group’s shares, investing in AI-focused startups, continued gains throughout the session, closing as the best performer on the Nikkei with a 6.5% rise.

Fujikura, a manufacturer of electrical circuits and optical cables, jumped 5.1% to second place, followed by Advantest, a chip testing equipment maker, which rose 4.7%.

The broader Topix index rose 1% to 3,080.17 points. The US Nasdaq Composite gained over 1% the previous night, rebounding strongly after a 0.8% decline the session before. Global stock markets were affected this week by a sharp rise in long-term bond yields amid concerns about worsening financial conditions in major economies from the US to France, the UK, and Japan.

However, markets calmed overnight after modest US jobs data reinforced expectations that the Federal Reserve will cut rates later this month.

Other notable gainers on Thursday included Fast Retailing, owner of the Uniqlo clothing brand, which rose 2.5%. Sony Group shares gained 2.9%, and Toyota Motor rose 1.9%. Among the biggest losers, Nidec shares plunged 22.4% after the electric motor maker disclosed an accounting error.