European stocks head for 7th weekly gain

Yen at two-month high on rate hike bets

Gold consistent near record peak

By Amanda Cooper

LONDON, Feb 7 (Reuters) -

U.S. stock futures steadied on Friday ahead of U.S. payrolls information, with financiers very carefully positive that the world may avoid a full-on trade war, while the possibility of more rate hikes in Japan this year briefly sent the yen towards two-month highs.

In a week that began with U.S. President Donald Trump starting a trade war and whipping up market volatility, financiers have actually watched out for making any major relocations, considered that he followed through on his hazard to enforce responsibilities on China while granting Mexico and Canada a one-month reprieve.

The critical U.S. jobs report for January is due ahead of the Wall Street open. Economists anticipate to see 170,000 added to nonfarm payrolls last month, however offered the prospective distortions from spells of cold weather condition and the California wildfires, the variety of projections is wide.

"The focus for the financial markets in recent weeks has been quite on Trump and his financial policies, in specific on trade, however today there is the capacity for the tasks data to influence Fed rate expectations," Derek Halpenny, a currency strategist at MUFG, said.

"A quite big divergence from the agreement is still most likely required to shift expectations notably but extreme weather condition at this time of the year has in the past resulted in sharply weaker NFP readings and weather might affect today ´ s report," he said.

Futures on the Nasdaq and S&P 500 were trading mainly stable on the day, while shares of

Amazon

insinuated premarket trading on the back of

weak point

in the retailer's cloud unit.

In Europe, the STOXX 600 headed for a seventh straight week of gains, trading flat on the day after having actually hit record highs previously today, following a spate of strong incomes from the likes of Danish weight-loss drugmaker Novo Nordisk, German software application business SAP and French lender BNP Paribas.

European stocks have actually staged their best efficiency in a decade against Wall Street in the first six weeks of 2025, however the focus is now on whether those gains can be sustained.

On the Asian market, tech stocks staged a rally, powered by Chinese retail financiers, who have attacked on the AI style in the wake of home-grown start-up DeepSeek's advancement.

DELICATE CHINA

Beijing's relatively determined reaction to Trump's tariffs has left space for negotiations, analysts say, which has actually assisted repair investor sentiment.

China's blue-chip stock index closed up 1.3% after touching a one-month high.

"Whilst there is significant sound and uncertainty, we do not see intensifying trade tensions as a game changer in the potential customers for the Chinese market," said James Cook, investment director for emerging markets at Federated Hermes.

Markets are pricing in 43 basis points of relieving this year from the Fed, with a rate cut in July completely priced in, as policymakers remain in no hurry to begin the rate-cutting cycle again.

The dollar edged up 0.1% against a basket of currencies, having actually rallied 7% in 2015, as investors priced in a far more aggressive policy position from the Fed this year, where rate cuts might be few and far in between.

Other main banks are cutting interest rates, akropolistravel.com while the Bank of Japan is tailoring up for a minimum of another rate hike this year. Strong wage development information has actually boosted the opportunities of tighter financial policy, which has actually pressed the yen to two-month highs against the dollar.

The yen touched 150.96 per dollar over night, its greatest level given that December 10, before alleviating to leave the dollar up 0.4% on the day at 152.155.

Sterling reversed earlier losses to increase 0.1% to $1.2449, having dropped 0.5% on Thursday as the BoE cut rates of interest and slashed its 2025 UK growth projection.

In commodities, oil edged up, while gold steadied above $2,800 an ounce, near to tape-record highs.

(Additional reporting by Ankur Banerjee in Singapore; extra reporting by Stephen Culp, Marc Jones and Alun John; modifying by Shri Navaratnam, Sam Holmes, Gareth Jones and Angus MacSwan)