LONDON (Reuters) – World stocks were battling to avoid their first weekly fall in six weeks on Friday, as investors waited to see whether key U.S. jobs data later would give the Federal Reserve another reason to dismiss rate cut calls.

Europe’s bourses nudged fractionally higher early on as earnings from banks HSBC and Societe Generale cheered traders and encouraging Adidas profits < ADSGn.DE> sent the German sportswear firm’s shares leaping 7 percent to a record high.

The dollar was also trying to end the week on a firmer note having seen markets scale back bets on a U.S. rate cut this week. As well as the jobs figures later, there are no less than eight Federal Reserve policymakers due to speak.

Bond and commodity markets remained firmly on the backfoot however with most benchmark government bond yields up on the day and Brent oil slipping back toward $70 a barrel again for what will be its worst week in over two months.

Fund manager UBP strategist Koon Chow said it all pointed to a little bit of the steam coming out of the markets after a flying start to the year.

“For the last four months it has been the unwinding the extreme pessimism that had built up (last year)” he said, referring to trade war nerves and the slowdown in many of the world’s largest economies.

“So here we are now in search of the next big thing, and I think today, and for the last few weeks, it is a views and portfolio repositioning exercise.”

U.S. employment figures are due at 1230 GMT, which are forecast to show 185,000 net new jobs were added in April and the unemployment rate at a steady 3.8 percent.

A report by payrolls processor ADP on Wednesday showed U.S. private employers added 275,000 jobs last month.

A solid official reading later would bolster the notion the world’s biggest economy remains on track for its longest expansion ever, further boosting the dollar potentially and the prospects for corporate earnings.

Overnight Asian trading had remained thin with both Japan and China traders still enjoying holidays. Hong Kong was in though and climbed 0.4 percent , the Australian market gained 0.1 percent, while Korea’s KOSPI slipped 0.5 percent.

Overnight on Wall Street, major indices,, had given up an initial attempt to regain their record highs and closed in the red, weighed down by energy shares.

Oil prices had plunged again after U.S. crude production output set a new record, though the losses were capped by the intensifying political crisis in Venezuela and the stopping of Iranian oil sanction waivers by Washington.[O/R]

U.S. crude was still in the red in early London trade down 0.3 percent at $61.65 a barrel, while Brent slipped 0.5 percent to $70.42.

PRESSURE DOWN UNDER

In the currency markets, Australian and New Zealand dollars both fell as speculators wagered both countries could see interest cuts next week. [FRX/]

The Aussie slipped below psychological support of $0.7000 overnight to the lowest since early January while the kiwi dollar drifted closer to a recent five-month trough of $0.6581.

The weakness in the antipodean currencies also came as the U.S. dollar gained on remarks by U.S. Federal Reserve Chair Jerome Powell earlier this week that a recent weakness in inflation owed to “transitory” factors.

That led traders to start paring expectations for a Fed rate cut. Futures now imply about a 49 percent probability of an easing at year-end, down from 61 percent late on Wednesday, according to CME Group’s FedWatch program.

The dollar index held at 97.842, inching toward a two-year peak of 98.33 touched last week.

Against the Japanese yen, the dollar was little changed at 111.48 having spent the entire week in a tight 111.03-111.89 range, while the euro stayed closed to $1.12

(Graphic: US ADP non farm datastream, tmsnrt.rs/2DFqpOn)

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