A look at the day ahead in European and global markets from

Stella Qiu

Global shares are pulling back after a bumper quarter.

Quarter-end rebalancing was partly to blame but there are also

bubbling concerns about how long the AI party will go on. News

that Meta plans to sell excess AI compute does make one wonder

if it still has the need to buy all those hot chips.

Asia took an early kicking. South Korea was initially

hammered nearly 7% on heavy selling in chipmakers including SK

Hynix and Samsung Electronics ( SSNLF ), though

the rout has abated somewhat. The KOSPI was last off 3% and

Japan's Nikkei was down 1.2%. European bourses are bracing for a

flat open, with pan-region stock futures up 0.1%.

Nasdaq futures rose 0.3% and S&P 500 futures

were 0.2% higher.

Hereafter, the focus will be on the U.S. nonfarm payrolls

report, arriving a day early due to the Independence Day holiday

on July 4.

Economists expect a median rise of 110,000 jobs in June, but

forecasts range widely from 25,000 to 200,000. The football

World Cup has probably created thousands of temporary jobs,

adding to the high chance of an upside surprise. The jobless

rate is forecast to stay steady at 4.3%.

Treasury yields have been climbing in anticipation of some

strong numbers, with two-year yields up 9 basis points on the

week so far, regardless of what Federal Reserve Chair Kevin

Warsh said about inflation riskcoming down.

A jobs beat will likely add to market pricing for policy

tightening from the Fed this year, with a move in September

about 80% priced in, while a weak result would ease pressure for

any interest rate hikes this year.

Global central banks are finding solace in oil prices which

hit another four-month low on Thursday. European Central Bank

President Christine Lagarde said inflation and growth risks were

more broadly balanced now, as markets pare back the possibility

of an ECB rate hike.

The euro zone unemployment rate for May is also due later in

the day, where the forecast is for a steady 6.3%. Inflation

eased more than expected to 2.8% in June.

The yen hovered near a 40-year low at 162.52 a dollar, with

the U.S. jobs data likely to be pivotal in determining its

near-term fate. Japan has stepped up intervention rhetoric but

has not been seen in the market yet.

Rather, sources said officials are abandoning their habit of

telegraphing intervention, instead planning a more calculated

campaign to squeeze short positions and raise the cost of

betting against the yen.

Key developments that could influence markets on Thursday:

* US payrolls report for June

* Euro zone unemployment rate for May

* Federal Reserve Bank of San Francisco President Mary Daly

speaks in Spain