EMEA Morning Briefing: Markets Await U.S. Jobs Report

MARKET WRAPS

Watch For:

EU inflation; trading update from Volvo Car

Opening Call:

European stock futures traded mixed early Friday. Asian stock benchmarks were lower; the dollar weakened; Treasury yields edged higher; oil futures and gold declined.

Equities:

Stock futures point to a mixed open in Europe as markets await the U.S. September nonfarm payrolls report. Investors are closely tracking the data to gauge what the Federal Reserve might do at its October meeting.

Traders are currently pricing in a 72% chance that policymakers hold rates steady, according to the CME's FedWatch tool.

Economists polled by FactSet expect the economy added 84,000 jobs last month after a 162,000 jump in August.

"Rate hike odds for October-which fell massively this week on PCE, dovish Fed talk, and soft data-likely hinge on the jobs report and September inflation data," said Joe Mazzola, a strategist at Charles Schwab.

Forex:

The dollar weakened ahead of the U.S. nonfarm payrolls report due later in the day. "Continued U.S. labor-market resilience would reinforce higher-for-longer U.S. rates, keeping U.S. yields and the USD supported, limiting the benefit from stronger Asian macro data," MUFG Bank's senior currency analyst Lloyd Chan said.

Bonds:

U.S. Treasury yields edged higher after Thursday's retreat from multiyear highs. Fed Vice Chair Philip Jefferson said Thursday that officials may need more time before determining whether to raise rates again, mirroring remarks by New York Fed President John Williams, who said Tuesday that there was "no need for urgency" following September's rate increase.

Michelle Bowman, who is the Fed's vice chair for bank supervision, struck a similar note during a question-and-answer session.

Multiple Fed officials struck a patient tone on Thursday, collectively signaling a preference to hold rates steady at the Federal Open Market Committee meeting this month, UOB's Global Economics & Markets Research team said.

Energy:

Oil prices fell amid continuing tensions in the Middle East. The Pentagon is sending a third aircraft-carrier strike group and additional Marine Corps ships to the Middle East, adding 9,000 to 10,000 more troops to the region as President Trump considers renewing strikes on Iran after the midterm elections, according to a Wall Street Journal report.

"Markets can tolerate uncertainty for a while, but they are getting tired of waiting for a breakthrough," Phillip Nova's Priyanka Sachdeva said. The oil market is increasingly pricing in a risk premium for the lack of a clear diplomatic off-ramp. The market isn't simply trading the next headline, but increasingly pricing in a world where supply chains remain vulnerable for longer, she added.

Metals:

Gold declined. The dollar and Treasury yields were currently the main obstacles to gold returning to its broader bullish path, said Simon-Peter Massabni, head of business development at XS.com.

Moderating inflation creates an opportunity for gold, but economic resilience and elevated yields are preventing a decisive breakout. "The real turning point will not come from a single day of price action, but from markets sustainably repricing the path of U.S. monetary policy," Massabni said.

Copper was flat. Although tight supply and resilient demand continue to support prices, a stronger dollar and higher U.S. Treasury yields are limiting the upside.

Copper concentrate supply remains tight, putting pressure on smelters' margins, and tighter domestic scrap availability has helped keep refined-copper inventories low, Minmetals Futures analysts said. The U.S.-London copper spread also remains elevated on expectations of potential U.S. tariffs on refined copper, they added.

TODAY'S TOP HEADLINES

The Bond Rout Is Deepening Even as Oil Tankers Return to the Strait of Hormuz

The return of oil tankers through the Strait of Hormuz was supposed to bring down the price of crude, gasoline and diesel, taming inflation and lowering the world's borrowing costs. It isn't happening.

Even as U.S. forces have worn down Iran's grip on the waterway, helping oil shipments rebound toward prewar levels, the global crude-futures benchmark jumped 4.4% Thursday to $102.31 a barrel. Average U.S. gas prices tracked by AAA were hanging above $4.41 a gallon. And the 10-year Treasury yield, a rough proxy for interest rates on many types of loans, this week notched its highest level in 24 years.

Another Fed Official Suggests Next Rate Increase Can Wait

Federal Reserve Vice Chair Philip Jefferson said Thursday that officials may need more time before deciding whether to raise interest rates again, echoing signals from another Fed leader this week that cast doubt on bets the central bank would lift rates at its meeting later this month.

Remarks from Jefferson reinforced those of New York Fed President John Williams, who said Tuesday there was "no need for urgency" after the Fed's rate increase in September.

U.S. Sending Third Aircraft Carrier, Up to 10,000 More Troops, to Middle East

The Pentagon is sending a third aircraft-carrier strike group and an additional Marine expeditionary unit to the Middle East, according to U.S. officials, adding 9,000 to 10,000 more troops to the region as President Trump considers renewing strikes on Iran after the midterm elections.

The ships, jet fighters, Marines and sailors will arrive in the region by the end of November, the officials said. Trump recently told aides that he expects to resume bombing Iran that same month, The Wall Street Journal reported.

Ukraine Fires Hard-to-Stop Ballistic Missile for First Time

Ukraine said Thursday that it had launched a ballistic missile at a Russian target for the first time in combat, introducing a hard-to-stop weapon that Moscow already uses regularly to deadly effect.

The FP-7 ballistic missile brings Ukraine into a small group of nations that can manufacture the weapons, though it is unclear how successful the first attack was.

Nike Plans a Smaller Company as Sales Slide Deepens

Nike is planning to be a smaller company. After two straight quarters of falling revenue, Nike said it expects sales to keep declining this fiscal year and it will shrink its operations, cut jobs and merge regional businesses to adjust.

"This work will result in fewer roles across Nike," Chief Executive Elliott Hill wrote in a memo to employees. He said decisions on which jobs will be eliminated would begin in calendar 2027. "We do not yet know the number of roles or specific locations of positions."

ON Semicondcutor to Buy Synaptics for Cash, Not Stock, in Downsized Deal

ON Semiconductor will acquire Synaptics for cash rather than stock in a downsized deal, according to an amended agreement between the two companies.

ON said Thursday that it will pay $123 a share for Synaptics, giving the deal a value of around $5.7 billion, according to the company.

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Expected Major Events for Friday 04:30/NED: Sep Flash Estimate CPI

06:00/ROM: Aug PPI

07:00/SPN: Sep Unemployment

07:30/EU: Sep EuroCOIN indicator of euro area economic activity

08:00/ITA: Aug Retail Sales

09:00/EU: Sep Flash Estimate euro area inflation

09:00/CYP: Aug Retail trade

09:00/EU: 2Q Quarterly sectoral accounts

09:00/EU: 2Q Quarterly Balance of Payments

10:00/IRL: Sep Irish Live Register latest monthly figures

15:00/DEN: Sep Foreign Exchange & Liquidity

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(END) Dow Jones Newswires

October 02, 2026 00:15 ET (04:15 GMT)