By Dhirendra Tripathi
Investing.com --Stocks surged on Thursday as the drama on Capitol Hill resulted in an agreement to raise the debt limit on the federal government until December, thwarting a possible default.
Senators have agreed to pass a $480 billion increase in the limit. But they also pretty much guaranteed another partisan showdown come holiday time.
Uncertainty over the debt limit standoff had weighed on stocks. Investors are also looking to Friday’s job report for September, at once a barometer on the state of the recovery and a tool the Federal Reserve will use to determine the timing of its tapering program.
In good news, new jobless claims dropped last week by more than expected, which indicates the labor market is picking up.
Energy stocks also gained after oil prices rebounded. Earlier in the day there were concerns about a potential increase in supply after the U.S. said it would consider tapping emergency oil reserves to ease the pressure on gas prices.
Here are three things that could affect markets tomorrow:
1. Jobs, jobs, more jobs
Job creation is expected to have gotten a boost in September after the August disappointment of only 235,000 positions. According to estimates, the Labor Department is likely to give a figure of 500,000 for the jobs the economy added in September. The August total was the worst since January.
2. Hourly pay
Wages are expected to have maintained their north-drift but at a slower pace in September. Average hourly earnings are likely to have risen 0.4% month-on-month compared to August’s 0.6% rise, according to estimates of analysts tracked by Investing.com.
3. Unemployment rate
The unemployment rate is likely to have dropped to 5.1% in September from 5.2% in August. All of the jobs data comes out at 8:30 AM ET (1230 GMT).