Investing.com - Here's a preview of the top 3 things that could rock markets tomorrow.
1. It's Jobs Friday
Nonfarm payrolls data due 08:30 am ET – arguably one of the most important economic events of the month – will likely offer clues on future monetary policy as maximum sustainable employment is one the Federal Reserve’s key objectives.
Nonfarm payrolls are expected to show the U.S. economy created 189,000 jobs in May.
Economists forecast the jobless rate to remain steady at 3.9% while average hourly earnings for May are expected to rise 0.2% from 0.1% last month.
The Federal Reserve’s beige book report released Wednesday said labor markets remain “tight” and wage growth was moderate.
The nonfarm payrolls could provide fresh direction for the dollar, the policy sensitive United States 2-Year bond and the US stock market.
2. Traders Fear Global Trade War Looms
US stocks could be set for frenzied session as the United States’ 25% tariff on steel imports and a 10% levy on aluminum imports from Canada, Mexico and the European Union come into effect on Friday.
The tariffs triggered a retaliation as all three of the United States’ allies vowed to adopt equivalent measures, reigniting fears of a global trade war.
Mexico said it would penalize a host of U.S. imports including pork bellies, apples, grapes, cheeses and flat steel.
Canadian Prime Minister Justin Trudeau, meanwhile, said the tariffs were “totally unacceptable,” adding that Canada would consider retaliatory tariffs on a range of U.S. goods.
The European Commission's president, Jean-Claude Juncker, said that Europe would respond with countermeasures.
Germany’s economy minister Peter Altmaier warned last week a trade war with the U.S. would not only be limited to steel and aluminium but to other categories of products like cars, textiles and food.
The Dow Jones Industrial Average slumped 250 points on Thursday, closing at 24,415.84
3. US rig count data to signal further ramp up in output?
The weekly instalment of drilling activity from Baker Hughes on Friday, will provide investors with fresh insight into U.S. oil production and demand.
Data last week showed the number of U.S. oil rigs resumed their climb, raising the prospect of a continued expansion in U.S. output.
The ramp up in U.S. oil production saw oil prices slide Thursday despite a massive draw in crude supplies.
Crude futures settled 1.7% lower at $67.04 a barrel on Thursday.