European Shares Likely To Drift Lower As US Jobs Data Looms

European stocks may drift lower at open on Thursday after the S&P 500 and the Dow Jones Industrial Average snapped their three-day win streaks overnight amid rising geopolitical risks and caution ahead of the Supreme Court’s opinions on the legality of tariffs imposed by Trump expected Friday.

As the global landscape shifts into ‘troubled and dangerous times’, U.S. President Donald Trump announced on Wednesday a sweeping proposal to increase United States military spending to $1.5 trillion for the 2027 fiscal year.

Also, Trump said he “will not permit” defense companies to issue dividends or stock buybacks until they address his complaints about the industry, including executive pay packages and production issues.

Meanwhile, the Trump administration is asserting control over Venezuelan oil after seizing a pair of sanctioned tankers.

Trump will meet American oil executives on Friday to discuss plans for Venezuela’s oil sector, the White House said.

Trading later in the day may be impacted by reaction to the latest U.S. economic data, including reports on weekly jobless claims and the U.S. trade deficit.

The Labor Department is scheduled to release its December employment report on Friday, which could offer further insight into the labor market and the Federal Reserve’s policy outlook.

Economists currently expect employment to increase by 60,000 jobs in December after an increase of 64,000 jobs in November. The unemployment rate is expected to edge down to 4.5 percent from 4.6 percent.

Asian stocks were mixed amid the brewing China-Japan tensions. China started an anti-dumping probe into dichlorosilane imports from Japan, escalating a dispute between Asia’s largest economies.

Treasuries held overnight gains, and the dollar was steady against major currencies amid bets that the Federal Reserve will deliver at least two interest-rate cuts this year.

Oil prices edged up after two days of declines, with a larger-than-expected draw in U.S. crude inventories offering some support.

Gold extended losses, after having fallen over 1 percent on Wednesday due to profit taking.

Overnight, U.S. stocks fluctuated before eventually ending mixed. The S&P 500 slid 0.3 percent and the Dow dipped 0.9 percent after reaching record closing highs the previous day.

The tech-heavy Nasdaq Composite edged up by 0.2 percent as a slew of economic reports reinforced the view of a slowing yet resilient economy.

The JOLTS report hinted at a cooling labor market, while ADP reported a modest rebound in private hiring and the ISM Services PMI surprised to the upside.

European stocks also turned in a mixed performance on Wednesday as investors monitored the latest U.S.-Venezuela developments and assessed the outlook for the ECB’s policy this year.

The pan European Stoxx 600 closed flat with a negative bias. While the German DAX surged 0.9 percent, France’s CAC 40 finished marginally lower. The U.K.’s FTSE 100 shed 0.7 percent after a recent run of record highs.