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Day Ahead: Top 3 Things to Watch

Published 05/12/2019, 21:27
Updated 05/12/2019, 23:11
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Investing.com – Here’s a preview of the top three things that could rock markets tomorrow.

1. It's Jobs Friday!

The U.S. labor market is expected to have rebounded last month as General Motors (NYSE:GM) strikers returned to work.

The Labor Department will release its latest jobs figures at 8:30 AM ET (13:30 GMT).

Economists expect that nonfarm payrolls rose by 186,000 last month, according to forecasts compiled by Investing.com.

That is "well above the 128,000 see in October, as roughly 48,000 GM strikers and 12,000 workers who suffered layoffs during the GM strike are expected to have returned to payrolls during the month," said Diane Swonk, chief economist at Grant Thornton.

The unemployment rate is forecast to remain unchanged at 3.6%.

Wage growth is expected to have crept up to a pace of 0.3% in November, up from 0.2% a month earlier, but unchanged year on year at 3%

2. Michigan Consumer Data

The holiday season is now in full swing, and many are eager to gauge if the U.S. consumer is showing any signs of reining in spending.

The University of Michigan’s consumer sentiment index for December due at 10:00 AM ET is forecast to show a preliminary reading of 97, up slightly from the previous reading of 96.8, while consumer expectations data will also be in focus.

3. Oil Markets in Focus

OPEC agreed Thursday to deepen production cuts by 500,000 barrels a day along with its allies until the end of March, the Wall Street Journal reported, citing delegates.

Non-OPEC members, however, including Russia still need to back the proposed deal on Friday.

Crude oil futures settled unchanged at $53.43 a barrel amid concerns that the production cuts are having a diminishing impact on oil prices, as OPEC and its allies make up only about half of the world's crude production.

Importantly, demand rather than supply has been the key driver of prices so far this year as global economic growth remains vulnerable to the ongoing U.S. and China trade war.

The latest rig count data will also come into focus Friday for clues on crude production activity as U.S. production remained at a record 12.9 million barrels a day.

Data last week showed the number of oil rigs operating in the U.S. fell by 3 to 688. But the rig count is also down nearly 25% from a year ago.

The weekly rig count is an important barometer for the drilling industry and serves as a proxy for oil production and oil services demand.

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