Europe midday: Shares mixed ahead of US jobs data; Oil rises again

(Sharecast News) - European shares were mixed on Friday as investors eyed key US jobs data later in the day and also assessed a massive restructure plan from German car maker Volkswagen.

The pan-regional Stoxx 600 index was up 0.07% to 649 at 1102 GMT, while Germany's DAX climbed 0.23% on the Volkswagen news.

German sentiment was also boosted by data revealing factory orders rose 2.5% month‑on‑month in July, according to the Federal Statistical Office, marking a third consecutive increase and comfortably beating expectations.

Destatis highlighted that the gain was driven almost entirely by a surge in large transport‑equipment contracts as orders for ships, rail rolling stock and aircraft jumped 126.4% on the month, offsetting weakness elsewhere in the manufacturing sector and helping headline demand outperform the 0.3% rise expected.

US markets rose overnight and Treasury yields retreated after Federal Reserve Governor Christopher Waller said he would be "inclined" to hold rates at this month's meeting of policy makers.

He also suggested the Fed was watching next week's inflation data before making a move, hinting that today's payroll data carried less weight on this occasion.

Economists are expecting a rise of 53,000 in non-farm jobs to be added last month compared with the shock loss of 23,000 jobs in July.

Oil prices remained elevated as the US seemed incapable of extricating itself from its war of choice with Iran. Brent crude moved beyond $96 a barrel as investors fear a supply crunch later this year, with the key Strait of Hormuz effectively shut.

On the economics front, the downturn across the eurozone construction industry deepened in August as new orders shrank at their fastest pace in four months, according to data out on Friday from S&P Global.

The S&P Global construction purchasing managers' index fell to 43.0 last month, down from 44.3 in July, marking the 52nd straight monthly contraction across the sector.

In equity news, shares in Volkswagen jumped on the restructure deal, the biggest restructure in its 89‑year history, as it also announced plans to cut a total of 100,000 jobs and halve the number of models produced as the company confronts mounting pressure from Chinese rivals, high energy costs and the expensive shift to electric vehicles.

The move followed tense negotiations with unions representing the company's more than 650,000 workers worldwide, with labour leaders ultimately backing the deal.

Volkswagen had already agreed to reduce its workforce by about 50,000 by 2030, with deals reached with 37,000 employees so far. The latest plan lifts the total cuts to around 100,000, or around 15% of the workforce.

Reporting by Frank Prenesti for Sharecast.com