(Bloomberg) — Stocks edged higher as investors awaited an annual review of US jobs data as well as Federal Reserve meeting minutes for further clues on interest rate cuts.
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Futures on the S&P 500 ticked up 0.2% as Target Corp. jumped in premarket trading after ending a string of sales declines. The yield on 10-year Treasuries was steady at 3.82%, while the dollar paused a three-day run of declines. Europe’s Stoxx 600 added 0.4% amid thin trading volumes.
Anticipation is mounting before Fed Chair Jerome Powell’s Jackson Hole speech at the end of the week that could decide whether the market rebound has further to run. As traders look to Wednesday’s payrolls revisions, there’s concern signs of excessive weakness will revive fears the Fed is behind the curve on lowering rates.
“Given that the US labor market is at the center of the Fed’s policy, the publication is of unusually high interest,” said Amanda Sundstrom, interim chief strategist for Norway at SEB AB. “A large downward revision in the number of new jobs created could add new fuel to concerns that the Fed has waited too long to cut interest rates.”
Goldman Sachs Group Inc. and Wells Fargo & Co. economists expect the government’s preliminary benchmark revisions on Wednesday to show payrolls growth in the year through March was at least 600,000 weaker than currently estimated. While JPMorgan Chase & Co. forecasters see a decline of about 360,000, Goldman indicates it could be as large as a million.
Dollar, Gold
Rate-cut bets have driven a bout of dollar weakness, but the US currency halted the slide on Wednesday on speculation the drop may be overdone.
“The dollar selloff is taking a breather given the speed of recent losses,” said Valentin Marinov, a Credit Agricole strategist in London.
A lot of Fed-related negatives appear to be priced in already as the US rates market prices in almost 100 basis points of cuts this year, he said.
Gold held steady near a record high after the dollar’s recent run of losses. A weaker greenback typically aids gold as it is priced in the US currency.
Corporate Highlights:
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Walmart Inc. raised about $3.6 billion by selling its stake in Chinese e-commerce firm JD.com Inc., winding down an eight-year partnership that appears to be paying diminishing returns amid a challenging landscape for Chinese tech giants.
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US coal producer Consol Energy Inc. agreed to buy rival Arch Resources Inc. for $2.3 billion as the transition to greener fuels threatens the industry’s long-term outlook.
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Cosmetics retailer Sephora is cutting hundreds of staff in China, according to people familiar with the matter, as one of LVMH’s biggest brands tries to turn around a loss-making operation in the world’s second-largest economy.
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Brookfield Asset Management is asking banks to line up about €9.5 billion ($10.6 billion) of debt for its potential take-private deal for Spanish pharmaceutical producer Grifols SA, according to people with knowledge of the matter.
Key events this week:
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US Fed minutes, BLS preliminary annual payrolls revision, Wednesday
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Eurozone HCOB PMI, consumer confidence, Thursday
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ECB publishes account of July rate decision, Thursday
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US initial jobless claims, existing home sales, S&P Global PMI, Thursday
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Japan CPI, Friday
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Bank of Japan Governor Kazuo Ueda to attend special session at Japan’s parliament to discuss July 31 rate hike, Friday
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US new home sales, Friday
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Fed Chair Jerome Powell speaks at Jackson Hole symposium in Wyoming, Friday
Some of the main moves in markets:
Stocks
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S&P 500 futures rose 0.2% as of 7:38 a.m. New York time
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Nasdaq 100 futures rose 0.2%
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Futures on the Dow Jones Industrial Average rose 0.1%
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The Stoxx Europe 600 rose 0.4%
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The MSCI World Index was little changed
Currencies
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The Bloomberg Dollar Spot Index rose 0.1%
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The euro fell 0.1% to $1.1114
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The British pound was little changed at $1.3032
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The Japanese yen fell 0.6% to 146.11 per dollar
Cryptocurrencies
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Bitcoin rose 0.2% to $59,431.19
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Ether fell 0.3% to $2,582.89
Bonds
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The yield on 10-year Treasuries advanced one basis point to 3.82%
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Germany’s 10-year yield was little changed at 2.22%
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Britain’s 10-year yield was little changed at 3.92%
Commodities
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West Texas Intermediate crude rose 0.1% to $73.25 a barrel
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Spot gold fell 0.1% to $2,511.36 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Rob Verdonck, Jeanny Yu, Winnie Hsu and Ruth Carson.
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