European stocks head for 7th weekly gain

Yen at two-month high on rate trek bets

Gold steady near record peak

By Amanda Cooper

LONDON, Feb 7 (Reuters) -

U.S. stock futures steadied on Friday ahead of U.S. payrolls data, with financiers very carefully optimistic that the world might prevent a full-on trade war, while the prospect of more rate hikes in Japan this year briefly sent out the yen towards two-month highs.

In a week that began with U.S. President Donald Trump beginning a trade war and whipping up market volatility, investors have watched out for making any major relocations, offered that he followed through on his risk to enforce duties on China while giving Mexico and Canada a one-month reprieve.

The necessary U.S. tasks report for January is due ahead of the Wall Street open. Economists expect to see 170,000 workers contributed to nonfarm payrolls last month, but offered the possible distortions from spells of winter and the California wildfires, the range of projections is large.

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

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

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

Amazon

slipped in premarket trading on the back of

weakness

in the retailer's cloud unit.

In Europe, dokuwiki.stream the STOXX 600 headed for a seventh straight week of gains, trading flat on the day after having actually hit record highs earlier this week, following a spate of strong incomes from the similarity Danish weight-loss drugmaker Novo Nordisk, German software application company SAP and French lending institution BNP Paribas.

European stocks have actually staged their finest performance in a years against Wall Street in the very 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 actually caught the AI style in the wake of home-grown start-up DeepSeek's development.

DELICATE CHINA

Beijing's apparently measured reaction to Trump's tariffs has left room for negotiations, experts 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 substantial sound and uncertainty, we do not see escalating trade stress 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 alleviating this year from the Fed, with a rate cut in July totally priced in, as policymakers remain in no hurry to start the rate-cutting cycle again.

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

Other main banks are cutting rate of interest, while the Bank of Japan is tailoring up for at least another rate hike this year. Strong wage growth data has intensified the opportunities of tighter financial policy, which has pressed the yen to two-month highs against the dollar.

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

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

In products, oil edged up, while gold steadied above $2,800 an ounce, near record highs.

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