Europe midday: Stocks extend gains as basic resources rally ahead of payrolls

Basic resources helped European stocks to push higher on Friday as investors awaited the release of the all-important nonfarm payrolls report later in the day.

At midday, the benchmark Stoxx Europe 600 index was up 0.3%, Germany’s DAX was 0.8% higher and France’s CAC 40 was 0.6% firmer.

Basic resources lent support as metals prices advanced and copper hit its highest level in more than three months, with the Stoxx 600 index for the sector up 2.2%.

Meanwhile, oil prices edged up following choppy moves on Thursday, with West Texas Intermediate up 0.3% to $34.68 a barrel and Brent crude 0.4% higher at $37.22.

All eyes will be on the nonfarm payrolls report and the unemployment, both due at 1330 GMT.

“Whilst a stronger-than-expected number indicating a very healthy job market is unlikely to spark the Fed into action any time soon, traders will consider this as an indication that the US economy is likely to remain healthy and continues to expand in 2016,” said Markus Huber, senior analyst at Peregrine & Black.

“Once today's data is out of the way main focus will switch over to next week's ECB meeting with expectations of major new measures to stimulate growth and combat low inflation still growing.”

Consensus expectations are for an improvement to 195,000 in the payrolls, while the unemployment rate is expected to remain unchanged at 4.9%.

In corporate news, London Stock Exchange was a little weaker after posting a 31% increase in full year profit and reiterating the case for a merger with Deutsche Boerse.

Shares in WPP rose after it posted strong 2015 results, although it sounded a cautious note over the outlook for the advertising industry.

Dutch digital security firm Gemalto surged after its full-year profit beat analysts’ expectations.

French hotel group Accor rallied after a spokeswoman for the company said it was not in talks to buy Carlson Rezidor Hotel Group.

Bookmaker William Hill was on the back foot after UBS downgraded the stock to ‘sell’ from ‘buy’, pointing to an increasingly competitive backdrop.

Asset manager Schroders slumped after Citigroup downgraded the stock to ‘neutral’ from ‘buy’.