LONDON/SYDNEY, June 6 (Reuters) - Global stock markets were subdued on Friday as investors hunkered down for key U.S. payrolls data, while Tesla shares clawed back some ground in pre-market trading after a public feud between President Donald Trump and billionaire Elon Musk.
A run of soft economic data this week has made markets wary of a weak U.S. payrolls print, which would add to concerns of stagflation and pile pressure on the Federal Reserve to ease policy.
Investors were also digesting whether a phone call between Trump and Chinese leader Xi Jinping on Thursday and the prospect of further talks would help ease deep trade tensions between the world's two largest economies.
"That's probably going to be the number one thing for markets in reality," said Jason da Silva, global investment strategy director at Arbuthnot Latham, adding any breakthrough could help fuel a market rally after months of high uncertainty.
Tesla (TSLA.O), opens new tab shares bounced 5% in pre-market trading and its stock listed in Frankfurt gained 4% after Politico reported White House aides have scheduled a call between CEO Musk and Trump.
Tesla shares tumbled 14% overnight to wipe off $150 billion in market value, after Trump threatened to cut off government contracts to Musk's companies as their once close relationship turned into a bitter open disagreement.
European stocks were broadly flat (.STOXX), after similarly muted trading in Asia. Nasdaq futures and S&P 500 futures both gained about 0.4% respectively.
In currencies, the euro traded near six-week highs versus the dollar, after the European Central Bank cut interest rates as expected on Thursday but hinted at a pause in its year-long easing cycle.
The euro slipped 0.2% on Friday to $1.1424, weighed slightly by weak German export data, but remained on course for a 0.7% weekly gain.
Money markets now price in a roughly 18% chance of a July cut compared with almost 30% just before ECB President Christine Lagarde gave a press conference on Thursday.
The ECB should stop cutting interest rates at every meeting and instead keep its powder dry given an uncertain economic outlook, ECB policymaker Martins Kazaks told Reuters.
The dollar was 0.3% higher against its major peers and just a touch above a six-week low.
Weaker-than-expected U.S. labour market data, including a 47% year-on-year jump in layoffs tracked by Challenger and a significant downside surprise in ADP's private payrolls, have dampened expectations for the payrolls report.
Forecasts are centred on a rise of 130,000 jobs in May, with the unemployment rate holding steady at 4.2%.
Any unexpected weakness could bring the next U.S. rate cut forward and trigger a huge rally in Treasuries. Futures imply scant chances of a rate cut until September, which is about 76% priced in.
In commodities markets, oil prices were last broadly flat and were headed for weekly gains on supply concerns. U.S. crude futures were last at $63.36 a barrel. In precious metals, gold prices gained 0.3% to $3,363 an ounce.
Editing by Sam Holmes, Susan Fenton and Toby Chopra
