Before the open - 05/07

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Asian shares leapt last night on the news that the Bank of England and the European Central Bank (ECB) indicated that interest rates would be kept at historic lows in the near future.

The MSCI index of Asian-Pacific shares excluding Japan rose by 0.7 per cent during trading, while the Nikkei opened up 0.94 per cent before making further gains to close up 2.08 per cent at 14,309.97.

The two European central banks’ announcements, including an indication from the Bank of England and an outright commitment from the ECB to pursue forward guidance (whereby the central bank indicates that interest rates will be held in place for an extended period) – sent the pound and the euro into freefall and European stock markets rocketing.

However, sentiment in the Eurozone has been tempered by events in Portugal. Prime minister Pedro Passos Coelho has managed to prevent his coalition government from collapsing, saying he received assurances of the continued backing of the Social Center Party, despite the resignation of its leader Paulo Portas as foreign minister. However, the situation remains fragile. Coelho also received the backing of ECB president Mario Draghi, who said that the results achieved in getting the country's finances and economy in order have been "quite significant, remarkable, if not outstanding", and Portugal is currently "in safe hands".

And stock market gains have also been held back by caution around upcoming US jobs data today. A very strong result could indicate that the Federal Reserve will begin tapering off its stimulus in the near future.

The FTSE closed up 3.08 per cent yesterday, and is expected to open cautiously higher ahead of the US figures.

Key events today:

1100: German factory orders (May)

1330: US unemployment, nonfarm payrolls, average hourly earnings, average weekly hours (June)

House of Commons vote on private member’s bill, which would mandate an in-out referendum on the UK’s membership of the EU by 2017

65th anniversary of the NHS

Official opening of Lithuania’s EU presidency