Following a rough jobs report from the UK, Europe tried to stay in the green on Tuesday, breakfasting on residual optimism left over from yesterday’s vaccine-led 900-point surge from the Dow Jones.
It has taken a while to filter through, but now the UK is starting to see the same kind of horrific jobs data as the US. After ducking the expected ballooning of unemployment claims in March, April reflected the fact that the pain was merely delayed by a month. The claimant count change for last month rose by 856,500 – to put that in perspective, March’s increase was 5.4k, while analysts were forecasting an increase of 675,000.
Elsewhere the jobs figures released on Tuesday weren’t quite as relevant. The average earnings index for the 3 months to the end of March dropped to 2.4% from 2.7%. while the unemployment rate for March actually fell from 4.0% to 3.9% month-on-month. Expect that to change going forwards, even with the mitigating factor of the government’s furlough scheme.
The pound took all this rather well. Against the dollar it rose 0.4%, to a near one-week peak of $1.2244, while against the euro it was up 0.3% to €1.12. This quickly pared back the FTSE’s gains, leaving the UK index flat at 6050.
Ahead of the latest ZEW economic sentiment readings – both expected to see a minor improvement month-on-month – the Eurozone indices were mixed. The DAX was flat at 11,080, but with the CAC down 0.4%.
Looking to this afternoon and the Dow Jones is hoping to add around 80 points, enough to lift it to a 3-ish week high of 24650.
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