(Alliance News) - Stocks in London are set to open up on Tuesday, tracking European markets in reaction to New York stocks extending their rally on weaker US jobs data, while markets reopened in London after a bank holiday on Monday.

IG says futures indicate the FTSE 100 to open up 32.3 points, or 0.4%, at 8,245.79 on Tuesday. The index of London large-caps closed up 41.34 points, 0.5%, at 8,213.49 on Friday.

Sterling was quoted at USD1.2549 early Tuesday, unchanged from the London equities close on Friday. The euro traded at USD1.0764 early Tuesday, lower than USD1.0769 late Friday.

In the US on Monday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.5%, the S&P 500 up 1.0% and the Nasdaq Composite up 1.2%.

The pace of hiring in the US slowed more than expected in April, and the unemployment rate rose, figures on Friday showed.

According to the Bureau of Labor Statistics, nonfarm payroll employment rose by 175,000 in April. This was below a FXStreet consensus of 243,000 and lower than the average monthly gain of 242,000 over the prior 12 months.

The February total was revised down by 34,000, to 236,000 from 270,000, while the total for March was revised up by 12,000, to 315,000 from 303,000. With these revisions, employment in February and March combined was 22,000 lower than previously reported.

The unemployment rate in April was 3.9%, rising from 3.8% in March.

In Asia on Tuesday, the Nikkei 225 index in Tokyo was up 1.3%. In China, the Shanghai Composite was up 0.2%, while the Hang Seng index in Hong Kong was down 0.5%. The S&P/ASX 200 in Sydney closed up 1.3%.

Australia's central bank left its key interest rates unchanged, and reiterated that it is "not ruling anything in or out" in terms of future moves.

The Reserve Bank of Australia said the cash rate target will remain at 4.35% and the interest rate paid on exchange settlement balances will stay at 4.25%. The decision was expected by the market, according to FXStreet-cited consensus.

In the bank's monetary policy statement, the board underscored that inflation is falling more gradually than expected.

Against the yen, the dollar was quoted lower at JPY154.54 from JPY152.89.

Japan's services sector continued to see robust growth in April, survey data showed.

The au Jibun Bank services purchasing managers' index rose to 54.3 points in April from 54.1 in March. Rising further above the 50-point no-change mark, it shows growth accelerated slightly from the prior month.

Brent oil was trading at USD83.51 a barrel early Tuesday, higher than USD82.91 late Friday.

Israel carried out strikes on the Gazan city of Rafah overnight as it sought to put "pressure" on Hamas ahead of talks in Egypt on Tuesday aimed at sealing a truce proposal endorsed by the militants.

After having vowed for weeks to push into the southern border town, Israel called on Monday for Palestinians in eastern Rafah to leave for an "expanded humanitarian area" ahead of a ground incursion.

After talks earlier in the day failed to produce an agreement, Hamas said Monday evening that it had informed mediators Egypt and Qatar of its "approval of their proposal regarding a ceasefire" in the seven-month-old war.

Israeli Prime Minister Benjamin Netanyahu's office said the proposal "is far from Israel's essential demands", but the government would send negotiators for talks "to exhaust the potential for arriving at an agreement"

Gold was quoted at USD2,322.59 an ounce early Tuesday, higher than USD2,301.11 on Friday.

In Tuesday's corporate calendar, BP releases its first quarter results.

In the economic calendar on Tuesday, a slew of construction PMIs are released, as well as UK house prices data at 0700 BST.

By Greg Rosenvinge, Alliance News senior reporter

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