The dollar was slightly firmer against the major currencies
Tuesday, while European stocks wavered between small losses and
gains, as investors awaited the release of the delayed U.S.
employment report for September--one of the casualties of the
prolonged government shutdown.
Early Tuesday, the dollar, which had been under pressure at the
end of the past week as investors pushed back their expectations of
when the Federal Reserve might start winding down its $85
billion-a-month asset purchases, was holding its own. The euro was
fetching $1.3676, compared with $1.3680 late Monday in New York,
and the dollar was at Y98.31, up from Y98.17. The pound, meanwhile,
was at $1.6127, compared with $1.6147.
Currency strategists at Societe Generale said that a strong
non-farm payrolls number with upward revisions to previous months
would support the dollar in the near term. But they added, "We
would not expect a new strong dollar trend yet. We would likely
need a strong suite of U.S. October data--unveiled over
November--before a dollar uptrend can be established."
Economists surveyed by The Wall Street Journal expect to see a
180,000 rise in payrolls and an unchanged unemployment rate of
7.3%.
Equity markets were fairly quiet again, with investors seemingly
reluctant to make any big bets either way. The benchmark Stoxx 600
index was flat. London's FTSE 100 was up 0.1%, while Germany's DAX
and France's CAC 40 both slipped 0.1%.
"Today's data is quite significant because it gives a sense of
how the U.S. economy was before the shutdown," said Keith Wade,
chief economist at Schroders, which has $388 billion in assets
under management. "We'd have to see quite a strong number for it to
have much impact on monetary policy going forward."
On the corporate front, U.K. consumer-goods company Reckitt
Benckiser Group PLC (RB.LN) surged after reporting 5% growth in
like-for-like revenue for the third quarter and saying it expects
full-year revenue growth to be at least 6%.
Shares in Dutch telecom company Royal KPN NV (KKPNY) rose.
Although it swung to a third-quarter net loss, analysts said that
excluding the E-Plus impairment, the numbers were slightly better
than expected.
Novartis AG (NVS) edged higher after raising its full-year
outlook for the second consecutive quarter.
On the downside, shares in Deutsche Lufthansa AG (DLAKY) slid.
Although the company said it expects operating profit this year to
rise to between 600 million euros ($820.5 million) and EUR700
million, it posted a sharp drop in earnings for the first three
quarters of the years.
In London, shares in microchip designer ARM Holdings PLC (ARMH)
fell after the release of its third-quarter results. Analysts at
J.P. Morgan Cazenove said that its earnings per share for the
period were in line with expectations, as was its fourth-quarter
sales guidance. However, it pointed to continued weakness in
smartphones, saying that taking some profits is warranted.
Write to Michele Maatouk at michele.maatouk@wsj.com
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