04.01 - U.S. jobs data ahead, Eurozone strong growth
Markets will focus on new employment data out of the U.S. today and tomorrow. Meanwhile, the USD moved lower as the selling mood continues. Also, Oil prices maintain its high levels from the past months. In Europe, the Eurozone showed the strongest growth in the last 7-years. here are all the things you need to know for today’s trading.
While traders wait for the publication of the U.S. monthly nonfarm payrolls (NFP) on Friday, they’ll digest other tidbits showing the state of American labor market on Thursday.
ADP will release its own monthly employment report at 13:15 GMT with consensus looking for the creation of 191,000 jobs. While the report from the private payroll processor is not considered a reliable indicator of the government’s own numbers, it still provides a solid indicator of tendencies in the U.S. job market.
15 minutes later, market participants will also observe the latest reading of weekly jobless claims with expectations pointing to 241,000 new applicants for unemployment subsidies.
While waiting for data, selling returned to the dollar on Thursday after a short-lived recovery a day earlier.
Robust U.S. manufacturing and construction data out on Wednesday briefly broke a five-session losing streak in the greenback, while minutes from the Federal Reserve’s December meeting also lent support.
The major focus centered on the fact that Fed officials discussed whether tax cuts could require them to raise interest rates at a faster pace in 2018 than last year.
"Most participants indicated that prospective changes in federal tax policy were a factor that led them to boost their projections of real GDP growth over the next couple of years," the minutes stated.
At 10:57 GMT, the U.S. dollar index fell 0.22% at 91.69.
Oil prices showed mixed trade on Thursday but maintained levels not seen since before a slump in commodity markets in 2014-15 amid ongoing tensions in Iran and as traders were eyeing the release of U.S. crude inventory data due later in the day.
Iran's Revolutionary Guards deployed forces to three provinces to put down the anti-government protests, marking the biggest challenge to the country's clerical leadership since 2009.
So far the unrest has had little impact on Iranian oil production with experts suggesting that, beyond worker strikes, the country’s oil resources are located far from where protests are currently taking place.
Meanwhile, market participants will keep an eye on U.S. crude inventories at 16:00 GMT amid expectations for a draw of around 5.1 million barrels. On Wednesday data from the American Petroleum Institute showed that U.S. oil stockpiles fell 5 million barrels.
The euro zone economy closed out the year with the strongest growth in nearly seven years, driven by accelerating services and manufacturing activity across all major economies, a survey showed on Thursday.
IHS Markit's composite purchasing managers' index (PMI) rose to 58.1 in December from 57.5 in the prior month. That was its highest level since February 2011 and well above the 50 mark that separates expansion from contraction.
Elsewhere in PMI data, Japanese manufacturers marked the final month of 2017 with the greatest improvement in operating conditions since February 2014, while Chinese composite business activity saw its fastest rate of growth in a year thanks to the quickest expansion in the services sector since August 2014.
- by Roger Gain