Five Things You Need to Know to Start Your Day

(Bloomberg) --

It’s jobs day, investors await news on China tariffs, and pressure off on Nafta deal for now. Here are some of the things people in markets are talking about today.

Payrolls

The consensus is for employers to have added 191,000 new positions in August, pushing the unemployment rate down to 3.8 percent. The data, released at 8:30 a.m. Eastern Time this morning, is also expected to show average hourly earnings holding steady at 2.7 percent. There were mixed labor-market figures yesterday, with the ADP Research Institute saying American businesses added the fewest workers in 10 months in August, while weekly jobless claims fell to the lowest level since 1969

Now what?

The deadline for public consultation on President Donald Trump’s plan to implement tariffs on a further $200 billion of Chinese goods passed yesterday, leaving Trump free to implement the measure at his discretion. Tech companies led by Cisco Systems Inc. and Hewlett-Packard Enterprise Co. were among those who sent letters to U.S. Trade Representative Robert Lighthizer ahead of the deadline urging the administration to avoid imposing new duties. But, with Trump seemingly determined to push ahead with the measure, investors are trying to judge which markets will be hit hardest. UBS AG warns the S&P 500 Index could drop 5 percent if the plan is implemented. 

No deal, yet

The pressure to strike a Nafta deal that includes Canada seems to have subsided, at least until the next deadline at the end of the month. That’s when the U.S. would need to publish the text of an agreement to sign before Mexico’s presidential election on Dec. 1. Both sides remain optimistic that a deal can be done, according to a Canadian official speaking on condition of anonymity. Democrats have said that they would strongly consider rejecting a trade deal that didn’t include Canada. Any pact would be voted on after the November midterm elections, with a Democrat majority in the House looking increasingly possible.

Markets slip

Overnight, the MSCI Asia Pacific Index retreated 0.2 percent while Japan’s Topix index closed 0.5 percent lower to top its worst week since March. In Europe, the Stoxx 600 Index was 0.3 percent lower at 5:45 a.m. as that gauge too headed for its worst week since March, not helped by reports that China’s HNA Group plans to exit its entire stake in Deutsche Bank AG. S&P futures were pointing to a lower open before the jobs report, the 10-year Treasury yield was at 2.886 percent and gold was flat.

Coming up…

While payrolls data is going to steal much of the limelight today, there are a few other things worth keeping an eye on. Canada also publishes its employment numbers at 8:30 a.m. Boston Fed President Eric Rosengren, Cleveland Fed President Loretta Mester and Dallas Fed President Robert Kaplan are all scheduled to speak today. At 1:00 p.m., Baker Hughes releases the latest U.S. rig count. Sweden holds a general election on Sunday that may lead to the nationalist Sweden Democrats emerging as the largest party -- while falling well short of an overall majority. 

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