By Lorcan Roche Kelly
Weekly jobless numbers, fast becoming the closest-watched economic data point of the coronavirus crisis, are expected to post another multi-million number when the data is published at 8:30 a.m. Eastern Time. The median estimate from economists surveyed by Bloomberg is for 5.5 million new claims which, on top of the combined 9.96 million from the previous two reports, clearly shows the breakneck speed of the economic slowdown in the U.S. due to the shutdown.
The world’s largest oil producers may thrash out a deal today on cutting output in the face of a huge collapse in the price of crude as global demand evaporates. Russia yesterday said it is willing to reduce production by 1.6 million barrels per day, a breakthrough that saw oil futures in New York jump 6.2%. A few problems remain, however, as the U.S. is not going to be joining talks today despite calls for President Donald Trump to commit to American production cuts too. More importantly for the price of oil is the growing market view that the proposed 10 million barrels-per-day reduction simply will not be enough to keep prices supported.
Federal Reserve Chairman Jerome Powell will speak at a webinar hosted by the Brookings Institution at 10:00 a.m. where he is likely to expand on the bank’s reactions to the coronavirus shutdown which has seen its policies move into unusual parts of financial markets. Minutes of the Fed’s Mar. 15 meeting showed that policy makers at that point saw downside risks to the economy warranting a “forceful” response. In Europe, ECB President Christine Lagarde once again called for strong fiscal measures from euro-area governments as finance ministers are set to meet again today to try to come to agreement after the most recent attempt ended in failure.
Yesterday’s climb back into bull market territory on the S&P 500 has not led to a gush of exuberance across global markets. Overnight, the MSCI Asia Pacific Index added 0.7% while Japan’s Topix index closed 0.6% lower as the virus outbreak there continued to worsen. In Europe, the Stoxx 600 Index was unchanged at 5:50 a.m. as investors possibly were unwilling to take on too much risk ahead of the four-day Easter weekend. S&P 500 futures pointed to a slightly lower open, the 10-year yield was at 0.743% and gold was higher.