Portugal Colonial - Global stocks diverge, oil prices gain on geopolitical fears

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Global stocks diverge, oil prices gain on geopolitical fears
Global stocks diverge, oil prices gain on geopolitical fears / Photo: Brandon Bell - GETTY IMAGES NORTH AMERICA/AFP/File

Global stocks diverge, oil prices gain on geopolitical fears

Global stock markets diverged Friday after tame tech earnings and investor jitters less than a week before a neck-and-neck US presidential election.

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Oil prices gained following reports that Iran was planning a major retaliatory strike on Israel as analysts say geopolitical fears have crept back into markets.

Big tech delivered a mixed bag of earnings this week, with concerns over AI spending overshadowing better-than-expected results from Microsoft and Facebook-parent Meta.

Wall Street closed sharply down on Thursday, with the tech-rich Nasdaq Composite index dropping nearly three percent.

Shares in Apple were lower in premarket trading even as the company enjoyed a boost from iPhone sales, while tech titan Amazon surged after it reported strong-than expected results particularly in cloud computing.

Tokyo dropped more than two percent as technology earnings hit it's Nikkei index.

Major European indices fared better, buoyed by a forecast-beating Chinese manufacturing report that boosted hopes for recovery in the world's second-largest economy.

London gained 0.8 percent, despite lingering fears of the consequences of the Labour governments high tax, high spending budget unveiled this week.

The UK's 10-year borrowing rate reached its highest level since November 2023 on Thursday, on fears of a resurgence in inflation.

"Worries continue to swirl about the UK Budget stoking inflation and adding to the debt burden," said Susannah Streeter, head of money and markets at Hargreaves Lansdown.

On the data front, investors are awaiting a key monthly US jobs report released later today for signals about the size and pace of Federal Reserve interest rate cuts.

"Barring a major surprise, markets will likely maintain their bets that the Federal Reserve will cut rates by a quarter-point next Wednesday," said Patrick Munnelly, market strategist at Tickmill Group.

Expectations of a major rate cut by the Fed, like the bumper 50 basis point cut in September, have receeded after data showed strong economic growth in the United States and that inflation is just above the central bank's long-term two percent target.

The fresh jobs data comes ahead of next week's coin-toss US election between Vice President Kamala Harris and former president Donald Trump, with jobs and the cost of living being key issues for voters.

"Markets have already priced in some risks of a second Trump presidency as they await the US presidential election," Lloyd Chan, an analyst at MUFG Global Markets Research, said in a note.

He added that Trump's proposed economic policies, including tariffs, could hurt the outlook for Asian economies.

- Key figures around 1120 GMT -

London - FTSE 100: UP 0.8 percent at 8,171.60 points

Paris - CAC 40: UP 0.7 percent at 7,400.00

Frankfurt - DAX: UP 0.6 percent at 19,188.82

Tokyo - Nikkei 225: DOWN 2.6 percent at 38,053.67 (close)

Hong Kong - Hang Seng Index: UP 0.9 percent at 20,506.43 (close)

Shanghai - Composite: DOWN 0.2 percent at 3,272.01 (close)

New York - Dow: DOWN 0.9 percent at 41,763.46 (close)

Euro/dollar: DOWN at $1.0864 from $1.0883 on Thursday

Pound/dollar: UP at $1.2914 from $1.2896

Dollar/yen: UP at 152.66 yen from 152.00 yen

Euro/pound: DOWN at 84.12 from 84.38 pence

Brent North Sea Crude: UP 1.9 percent at $74.22 per barrel

West Texas Intermediate: UP 2.1 percent at $70.72 per barrel

A.Silveira--PC