Europe stocks rise as traders weigh Fed taper outlook

Bloomberg

European stocks rise with US equity-index futures as investors bet slower hiring in the world’s largest economy may delay a tapering of Federal Reserve stimulus. Aluminum hit a decade high amid political unrest in Guinea.
The Stoxx Europe 600 Index inched closer to its record high, led by technology shares. Contracts on the S&P 500 Index rises 0.2% even as US markets were closed for Labour Day. Gains in Asia were led by Japan, where the equity benchmark rises to a 31-year high on wagers for new economic policies once Prime Minister Yoshihide Suga steps down.
The latest US jobs report threw traders’ calculations awry after they braced for an announcement of tapering at the Fed’s September meeting. The world’s largest economy added only 235,000 jobs in August — the smallest gain in seven months — boosting chances of a delay in that announcement.
“Expectations of a delay in Fed tapering as well as a new administration in Japan is supporting equity markets and we expect this to continue,” said Sebastien Galy, senior macro strategist at Nordea Investment Funds. “Buy-on-dip is as robust as ever, taking negative news such as US nonfarm payrolls as good news which is typical of an advanced carry trade.”
Aluminum hit the highest in over a decade as political unrest in Guinea fuelled concerns over supply of the raw material needed to make the metal. A unit of the military seized power and suspended the constitution, raising the possibility of disruption to bauxite shipment from the key global supplier.
The US dollar rises on Monday for the first time in five days. The cash market in Treasuries was closed. The S&P 500 was little changed and Treasury yields advanced as investors digested the disappointing US payroll growth and faster-than-projected wage increases.
Elsewhere, oil extended losses after Saudi Arabia slashed crude prices for Asian buyers. Bitcoin was up for a sixth day, trading just below $52,000.
The Stoxx Europe 600 rises 0.5% as of 9:34 am London time and futures on the Nasdaq 100 also climb 0.3%.
While futures on the Dow Jones Industrial Average rise 0.2%, the MSCI Asia Pacific Index also surges by 0.8%. The MSCI Emerging Markets Index rises 0.5%.
While the Bloomberg Dollar Spot Index climbs by 0.2%, the euro falls 0.2% to $1.1862 and the Japanese yen fell 0.2% to 109.88 per dollar.
The offshore yuan falls 0.2% to 6.4487 per dollar and the British pound also sinks by 0.2% to $1.3841.
Germany’s 10-year yield was little changed at -0.36% and Britain’s 10-year yield declined one basis point to 0.71%. While Brent crude falls 0.9% to $71.97 a barrel, spot gold falls 0.2% to $1,824.33 an ounce.