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 As investors awaited monthly U.S. jobs data, European shares saw
choppy trade, with bank stocks falling back and miners and metals
firms improving. The FTSE Eurofirst index of leading European shares
was marginally lower, having given back some early gains. U.S.
markets were set to open flat. [.N]
The ruble's collapse -- and the broader problems around Ukraine and
lower oil prices which it reflects -- are likely to put yet more
pressure on exports by European companies already struggling with
very poor demand at home.
With the currency battered by concerns about the conflict with
Ukraine and the tit-for-tat sanctions that have resulted, Russia's
central bank scaled back its support for the ruble earlier this
week.
Expectations the central bank might step strongly back into the
market after limiting intervention to $350 million daily helped turn
back the bulk of an initial 3-percent fall on Friday. But the
pressure remained.
"This is full-blown panic, with signs of a self-fulfilling currency
crisis," Dmitry Polevoy, chief Russia economist at ING Bank in
Moscow, said in a note.
"At such times, the central bank should intervene -- after all, if
this isn't a risk to financial stability, then what is?"
A source told Reuters that bank Governor Elvira Nabiullina was
holding a meeting but would not reveal more details.
President Vladimir Putin held talks with security chiefs on Thursday
over a "deterioration of the situation" in eastern Ukraine after
pro-Russian rebels there accused Kiev of launching a new offensive
in violation of a ceasefire.
The dollar was worth 47.23 rubles, having traded as high as 48.65
rubles earlier.
PAYROLLS
Asian stock markets edged down overnight ahead of the U.S.
employment numbers, due at 1330 GMT (8.30 a.m. EST), while the euro
recovered marginally from around two-year lows hit after a European
Central Bank meeting on Thursday.
As European stock markets turned marginally lower, traders cited
unease over whether the ECB has the ability to do enough to awaken
an increasingly moribund economy.
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The STOXX 600 Europe banks index was down 1.2 percent, with France's
Credit Agricole down 4 percent and National Bank of Greece down 7
percent.
"Given the fact that we've had some weak results in terms of loan
growth at French banks, with loan growth even negative at Credit
Agricole, there are fears of a real slowdown happening at these
banks," said BESI analyst Shailesh Raikundlia.
UK equities were the big outperformers, up 0.5 percent, with the
mining sector benefiting from a rebound.
Solid gains in U.S. employment are projected from the numbers later
on Friday, which could increase speculation the Federal Reserve will
raise interest rates in the middle of next year. That continues to
support expectations of a sustained rally in the dollar, up for the
third consecutive week.
"We are expecting a reading of 240,000 (new jobs) and anything above
that, in the region of 250,000 could send the dollar higher," said
Geoff Yu, currency strategist at UBS, London.
The dollar bought 115.14 yen, not far from a fresh seven-year peak
of 115.52 touched overnight. The euro inched up to $1.2402 after
brushing a more than two-year low of $1.2368. Brent crude recovered
from earlier losses to trade 0.2 percent higher at $83.09 a barrel,
while U.S. crude was up almost half a percent at $78.28.
(Additional reporting by Vladimir Abramov in Moscow and Lionel
Laurent in London; Editing by Catherine Evans and John Stonestreet)
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