Investing.com - Here are the top five things you need to know in financial markets on Friday, April 5:
1. Nonfarm Payrolls Forecast to Bounce Back
The U.S. Department of Labor will release its measures of the employment situation for March at 8:30 AM ET (12:30 GMT), following up on a very disappointing payrolls number for February.
Economists forecast that nonfarm payrolls will bounce back in March, rising by 175,000.
A meager 20,000 jobs were created in the second month of the year, the fewest since September 2017, while ADP’s report released Wednesday showed that the U.S. economy added the fewest private sector jobs in 18 months during March.
However, Thursday’s weekly data on jobless claims unexpectedly fell to their lowest level in nearly 50 years, suggesting that a long expansion in an economy near full employment has materially reduced labor market slack.
The market's focus will likely be on average hourly earnings which are expected to have increased 3.4% on an annualized basis, unchanged from the prior month.
The Federal Reserve will be watching that number as March could be the sixth consecutive month that it holds above the 3% level that economists generally consider to fuel inflation.
Read more: NFP Preview: Potential For Upside Beat – Will Traders Care? - Matthew Weller
2. U.S.-China Trade Talks Drag On
Negotiations over trade continue between the U.S. and China drag on, with President Donald Trump still unable to announce a date for a summit with his Chinese counterpart Xi Jinping to sign an agreement.
Trump downplayed the possibility of an immediate agreement, saying that “we’ll know over the next four weeks” if a deal has been reached.
Putting a more positive spin on things, China’s state run news agency Xinhua reported that a new consensus has been reached between the two sides, after high-level talks this week in Washington.
3. Stocks cautious ahead of jobs report
Caution ahead of the employment report limited upside in stocks early Friday. At 5:36 AM ET (9:36 GMT), the blue-chip Dow futures gained 27 points, or 0.1%, S&P 500 futures rose 4 points, or 0.1%, while the Nasdaq 100 futures traded up 15 points, or 0.2%.
European stock markets were also in cautious mood after slightly better-than-expected German industrial production data, but were still on track to end the week at their highest levels in eight months. Apart from the positive read on trade developments, markets showed confidence that the U.K. and European Union would avoid a cliff edge Brexit.
Earlier, Asian stocks closed higher on the positive vibe from trade negotiations, though caution ahead of U.S. payrolls and a holiday in China kept volume in check.
4. Oil on Track for Fifth Straight Week of Gains
Despite a selloff sparked on Wednesday by a 7.2 million surge in weekly U.S. oil inventories, crude remained on track to end the week higher. That would be its fifth straight week of gains, its best run since November 2017.
Oil prices struggled to recover on Friday, amid a lack of new catalysts to push prices higher, although markets were keeping an eye on developments in OPEC member Libya, where the forces of a prominent warlord have made big advances in recent days, threatening to undermine peace talks and - possibly - future oil supplies from the country.
U.S. crude oil futures slipped 2 cents, or 0.03%, to $62.08 by 5:37 AM ET (9:37 GMT), while Brent oil traded down 21 cents, or 0.3%, to $69.19.
Still on the docket, Baker Hughes will release its weekly rig count data, an early indicator of future output in the U.S., at 1:00 PM ET (17:00 GMT).
Last week’s reading showed that U.S. energy firms reduced the number of oil rigs operating for a sixth week in a row, to the lowest count in nearly a year.
5. Brextension in the Works
Prime Minister Theresa May formally requested to delay the U.K.’s exit from the European Union to June 30, ostensibly to allow time for U.K. lawmakers to approve a transitional deal to smooth the Brexit process.
May said that the U.K. would prepare to take part in European parliamentary elections next month, but would reserve the right to cancel them if an orderly exit could be agreed in the meantime. Any extension beyond the revised Brexit deadline of April 12th needs the unanimous agreement of the EU’s 27 other member states.
EU Council President Donald Tusk was reported by the BBC overnight to be open to a 12-month extension. The poundrose on the news, but fell back after reports citing a skeptical response from French officials.