European stock markets moved lower on Tuesday for the third straight day, as investors remained cautious before the closely watched U.S. nonfarm-payrolls report at the end of the week, which could affect the decision by the Federal Reserve whether or not to reduce its stimulus. A strong report on the U.S. manufacturing sector out on Monday stirred fears the reduction in bond buys could come as early as at the December meeting.
U.S. index futures were also little changed, while Asian shares outside Japan retreated. The benchmark Stoxx Europe 600 Index fell 0.3 percent yesterday following a three-month rally, as Spanish manufacturing unexpectedly contracted in November.
U.S. stocks fell on Monday, with the Dow and S&P 500 retreating after an eight-week winning streak. Monday's data caused Asian equities to decline although Japanese shares rose to a new six-month peak thanks to supportive comments from the country's central bank. . The MSCI Asia Pacific Excluding Japan Index fell 0.5 percent after a seven-day rally, while the Nikkei 225 Stock Average rose 0.6 percent in Tokyo.
ThyssenKrupp AG declined after raising 882.3 million euros ($1.2 billion) through a share sale. Sonova Holding AG (SOON) slipped 1.7 percent as Morgan Stanley cut its rating on the Swiss hearing-aid maker.
U.S. Jobs
On Friday, Dec. 6, investors will get the latest reading on U.S. non-farm payrolls for November and data may show that the unemployment rate has slipped to 7.2 percent, matching the lowest level in five years. A private jobs report tomorrow, Wednesday, may show U.S. employers added the most workers since June. The Fed has said it will monitor labor-market gains before deciding when to pare its $85 billion of monthly bond purchases.
In addition, the U.S. central bank will provide its Beige Book report on economic conditions in the world’s largest economy tomorrow, two weeks before the Federal Open Market Committee meets on Dec. 17-18 to consider changes to monetary stimulus. The European Central Bank and the Bank of England meet this week. Both banks will announce policy decisions on Dec. 5.
Yesterday’s markets saw two major corporations dropping. ThyssenKrupp declined 0.9 percent to 17.48 euros, falling the most since August 2011 after the company said it would increase its capital by 10 percent of its market value. And Sonova lost 1.7 percent to 123.20 Swiss francs. Morgan Stanley downgraded the stock to equal weight, similar to a neutral recommendation, from overweight. New product releases from competitors such as GN Store Nord A/S and William Demant Holding A/S may affect revenue growth, Morgan Stanley said.