European stock markets climbed higher on Friday, with London’s benchmark index hitting a new pandemic high on the back of economic optimism.
It comes as hiring in the UK surged last month as the economy reopened under Boris Johnson’s roadmap out of lockdown. Vacancies soared at their fastest pace in 23 years.
According to the Recruitment and Employment Confederation (REC) and KPMG, demand for staff is rising in almost every industry, with IT and computing jobs leading the way due to the shift to remote working.
Neil Wilson, chief market analyst at Markets.com, said: "The overriding market themes remain pretty well unabused: A monster commodity rally continues as the global economy heats up, and massive but messy rotation out of the tech/growth/momentum plays into more cyclical/value parts of the market."
It follows a record-breaking finish on Wall Street on Wednesday and as traders keenly await a key US jobs report later today.
Average estimates are for a number in the region of 1 million, especially as weekly jobless claims are also trending lower. They dropped below 500k a week yesterday, a post lockdown low, while the unemployment rate is expected to fall further, from 6% to 5.8%.
“This is very welcome especially since the participation rate has remained steady and actually edged up to 61.5% in March, and which is expected to move higher today, suggesting early signs that more disincentivised workers are returning to the workforce,” Michael Hewson at CMC Markets said.
Watch: US jobs surge beats forecasts in signs of labour market recovery
Overnight, the Federal Reserve also unveiled a semi-annual financial stability report.
The nation’s central bank said that financial system vulnerabilities increased over the last six months, pointing to the blow-up of family office Archegos Capital Management and the run-up in “meme stocks”.
“A few recent episodes have highlighted the opacity of risky exposures and the need for greater transparency at hedge funds and other leveraged financial entities that can transmit stress to the financial system,” the Fed noted.
Asian markets were mixed overnight despite strong trade data from China.
China’s exports surged last month as America’s recovery from the coronavirus pandemic boosted demand.
Exports rose by more than 32% compared to a year earlier to almost $264bn (£190bn), mostly driven by demand for PPE and other medical related products.
Imports also jumped, up 43.1% from a year ago to $221.1bn, accelerating from March’s 38.1% expansion.
Commodity prices also surged on Friday as the economic recovery creates a strong demand for raw materials.
Both iron ore and copper (HG=F) prices hit record levels, extending a recent rally in commodities.
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