Without being able to pinpoint an exact reason for the carnage, the US tech stocks were dealt an absolute beating on Thursday night, rapidly unravelling billions in gains made over the last few months.
The Dow Jones, which was finally in touching distance of the all-time highs that have alluded it this summer, plunged 800 points, seemingly on an amalgam of fears over the heady price of tech stocks, the threat the cold war between Washington and Beijing poses to the sector, and the worrying state of US employment.
The European stocks got caught up in the maelstrom before Thursday was over, leaving the FTSE, for one, down 90 points.
Friday, however, has seen Europe mount a rebound. The FTSE added 0.8% to near 5890, with the DAX up half a percent and the CAC – which had a real wild time of it yesterday, unable to avoid a red end despite France’s €100 billion stimulus plan – rising 1%.
The Dow Jones is looking for a 190 point increase when trading gets underway stateside, a move that would leave it just short of 28500.
Yet all of Friday’s gains come with a major caveat, in that the session’s main event – the US nonfarm numbers – isn’t until this afternoon.
Analysts are expecting 1.385 million jobs to have been created in August, down from the 1.763 million in July and 4.8 million in June. The unemployment rate, meanwhile, is set to drop to 9.8%, with wage growth at a stagnant 0.0%.
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