Five Things You Need to Know to Start Your Day
It’s jobs day, China-U.S. trade talks set to restart, and euro-area inflation slows sharply. Here are some of the things people in markets are talking about today.
Today’s U.S. jobs data for December is expected to show employers added 184,000 positions when the number is released at 8:30 a.m. Eastern Time. Forecasts suggest the jobless rate will hold at 3.7 percent and wage growth will cool slightly to 3.0 percent. Should today’s number turn out as expected, it would be below the 11-month average of 206,000, with economists suggesting that 2018’s strong growth will not be repeated in 2019.
Deputy U.S. Trade Representative Jeffrey Gerrish will lead a delegation to talk with Chinese counterparts on Monday in the first meeting of the two sides since a 90-day truce was agreed in Argentina last month. While the initial talks will be technical in nature, U.S. Trade Representative Robert Lighthizer is expected to meet with Chinese Vice Premier Liu He, President Xi’s top economic adviser, later this month, according to a person familiar with the matter. Stocks rose with investors seeing the meeting as a positive step towards resolving the trade war.
Euro-area inflation dropped to an eight-month low of 1.6 percent in December, down from 1.9 percent in November and below analyst expectations. The fall in headline inflation is unlikely to cause undue concern at the European Central Bank as much of the move was down to volatile oil prices – a measure of core inflation remained unchanged at 1 percent. In China, monetary authorities delivered stimulus by cutting the reserve ratio by 1 percentage point in a bid to revive sluggish growth.
Overnight the MSCI Asia Pacific Index slipped 0.2 percent, with Japanese markets proving a drag on the region as they played catch-up following some holidays. The Topix closed 1.5 percent lower after the first session of the new year. In Europe the Stoxx 600 Index was 1.3 percent higher at 5:45 a.m. as sentiment improved ahead of next week’s trade talks. S&P 500 futures also rose ahead of the jobs number, the 10-year Treasury yield was at 2.606 percent and gold slipped from its recent high.
As well as U.S. payrolls data, we also get Canadian unemployment numbers at 8:30 a.m. Markit services and composite PMIs for the U.S. are due at 9:45 a.m. At 10:15 a.m. Fed Chair Powell is joined by Janet Yellen and Ben Bernanke for an interview at the American Economic Association in Atlanta. For oil market watchers there’s the EIA oil inventory report due at 11:00 a.m. and the Baker Hughes rig count due at 1:00 p.m.
What we've been reading
This is what's caught our eye over the last 24 hours.
- Powell pledged allegiance to data, and some of it looks grim.
- The bad stuff that the stock market worried about is starting to happen.
- Aggressive change in market’s Fed outlook drives inversions in yield curve.
- Hackers dump personal details of hundreds of German politicians.
- Pound emerges a winner from this week’s flash-crash, Nomura says.
- Elon Musk is wrong, Tesla is not America’s No. 1 premium carmaker.
- Genetically modified “shortcut” boosts plant growth by 40 percent.
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