European markets fell Friday as investors awaited a key report on U.S. job losses and financial stocks pulled indexes down after the Royal Bank of Scotland reported a bigger first-half loss and issued a subdued outlook, according to AP. In afternoon European trading, Britain's FTSE 100 tumbled 1.1 percent to 4,637.22, Germany's DAX slipped 0.6 percent to 5,339.85 and France's CAC dropped 0.9 percent to 3,445.97. Wall Street was set to open lower. Dow Jones industrial average futures fell 0.4 percent to 9,197.00 and Standard & Poor 500 futures were 0.3 percent lower at 991.80. Asian markets ended mixed after Wall Street's decline Thursday, when investors were disappointed by U.S. unemployment and retail data released Thursday. Markets were awaiting Friday's U.S. government employment report, due out at 1230 GMT (8:30 a.m. EDT). It is expected to show job losses slowing in July to a pace of around 320,000, with unemployment rising to 9.6 percent, up from 9.5 percent the previous month. If the job-loss estimate is on target, it would be a heartening improvement from June's 467,000 job losses _ and the slowest pace for job losses since August 2008. «It is almost a calm before the storm _ there is a bit of profit-taking before the jobs data this afternoon,» said James Hughes, market analyst at CMC Markets. «People are getting out of positions ahead of the big number.» Royal Bank of Scotland led the declines in London after the bank, in which British taxpayers hold a 70 percent stake after a government bailout last year, reported its losses widened in the first half to 1.04 billion pounds ($1.7 billion) and that it had to take heavy writedowns. Chief executive Stephen Hester warned that overall results may not substantially improve until 2011. Hughes said Hester's comments were a «reality check» for European markets, which had reacted well to recent earnings reports from banks that had «been at the top end of expectations but still losses.» «Banking stocks aren't out of the woods,» he added. RBS shares plummeted 12 percent, while Lloyds Banking Group, another British part-nationalized bank which reported a smaller-than-expected loss on Wednesday, fell 7 percent. Earlier, in Asia, Japanese and South Korean stocks rose but China, Australia and other markets ended the week down, denting a rally driven by hopes the global economy might be emerging from its worst slump since the 1930s. Japan's benchmark Nikkei 225 gained 0.23 percent to close at 10,412 and South Korea's Kospi index gained 0.7 percent to 1,576. Hong Kong's Hang Seng index fell 1.4 percent to 2,880.30 while Australia's benchmark declined 0.64 percent to 4,303.10. Some investors feared the U.S. jobs report might show July job losses were worse than previously thought. «People are a little scared there might be some disappointment there. So they are taking profits on the week,» said Andrew Orchard, Asian strategist for Royal Bank of Scotland in Hong Kong. China's benchmark Shanghai Composite Index lost 2.9 percent to close at 3260.69. The Shenzhen Composite Index for China's smaller second exchange dropped 3.4 percent to 1087.23. Singapore's benchmark was down 2 percent at 2,549.35. On Thursday, the Dow Jones industrial average and other major U.S. indexes retreated after the government reported that new unemployment claims fell last week but the number of people continuing to claim benefits rose. Many of the biggest U.S. store chains reported disappointing July sales. The Dow fell 24.71, or 0.3 percent, to 9,256.26. The Standard & Poor's 500 index lost 5.64, or 0.6 percent, to 997.08, its first finish below 1,000 since Friday. Oil prices slipped below $72 in European trading. Benchmark crude for September delivery fell 53 cents to $71.41 per barrel in electronic trading on the New York Mercantile Exchange. On Thursday, the contract gained 17 cents to settle at $72.14.
