Copper soars ahead of what could be a blowout jobs report
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Good morning, and happy Friday.
It’s jobs day. The non-farm payrolls report comes out before the bell, and the forecast is for strong gains in the U.S. labor market. As you’ll recall, the markets ignored the brutal employment data last year. They will probably be unmoved by today’s batch, too. On cue, U.S. futures are dead-flat as I glance at the screens.
The action today can be found in Europe, with commodities (copper hit a new all-time high this morning), and in the “alt” corners of the crypto market. Dogecoin is on the move as crypto bulls pin their hopes on a Saturday night rally with Dogecoin fan Elon Musk hosting SNL. That Saturday Night Live could become a market-moving event says all you need to know about this bull run.
Meanwhile, if you’re wondering about Bitcoin this morning, I’ll be honest. It could use a little more cowbell.
Let’s see what else is moving markets.
- The major Asia indexes are closing out the week on a weak note. The Shanghai Composite, the worst of the bunch, is off 0.65%.
- Shares in Nintendo are off nearly 2% in late-day trading in Tokyo. That’s after the video game console specialist reported knockout profits. Don’t feel too bad for investors. The stock is up roughly 90% since March 2020, Fortune‘s Yvonne Lau reports.
- Stocks that are closely tied to the COVID vaccine rollout—not just the likes of Pfizer, BioNTech and Novavax, but also the Asia contract manufacturers—have been extremely volatile in recent days as a patent right waiver dispute emerges. Here’s a helpful explainer on what such a vaccine waiver would mean for the global rollout, and for stocks.
- The European bourses were broadly higher out of the gates with the Stoxx Europe 600 up 0.4% in the opening minutes. Consumer products and energy stocks were leading the way higher.
- Shares in Volkswagen were down 0.6% this morning after the German automaker shook off the global chips shortage and lifted its full-year guidance, but warned its profit margins would take a hit.
- Staying with German stocks… Adidas also raised its 2021 outlook as it bets on big sporting events resuming, and stadiums reopening. Shares were up more than 7% at the outset.
- U.S. futures are up a touch ahead of the big jobs report due out before the bell. All three major averages closed higher yesterday with the Dow hitting yet another record.
- Peloton gave investors a figure for its treadmills recall. It expects a smaller-than-expected $165 million sales hit in the current quarter. Shares are up 5.4% in pre-market, but still more than 10% below its Wednesday closing price.
- The Fed on Thursday warned investors of “significant declines” in risk-asset prices. Blue chip stocks shrugged off the warning, but the high-growth ones—look no further than Cathie Wood’s Ark Innovation—continue to slump.
- Gold is soaring, climbing to $1,820. It’s up 2.8% in the past week.
- The dollar is flat.
- Crude is flat with Brent trading around $68/barrel.
- Bitcoin is off more than 1% to trade around $56,000.
By the numbers
That’s the consensus estimate for net new job postings filled in April. The rosy number, says Goldman Sachs (which actually forecasts 1.3 million new jobs, above the consensus), can be attributed to America’s successful vaccination rollout. If anything, today’s data will under-represent America’s economic rebound. “The recent surge in business creation is unlikely to be properly captured in the employment numbers,” writes Paul Donovan, UBS chief economist notes this morning. “Some of these businesses will be ‘side hustles’—the economist promoting a recently published book on labor market prejudice via social media will still keep their day job. But some of these start-ups will substitute for traditional employment. Underreporting this means the U.S. economy is stronger than today’s data suggests.”
When I was a cub reporter, on the police beat back in the 1990s, there was an odd crime wave I followed for weeks one summer: the theft of scrap-metal. One of the favorite targets were churches. Brazen thieves would steal any piece of copper they could find, even pulling copper fixings off the roof or downspout. Back then, I now see from this Bloomberg chart, copper was trading below three grand a tonne. This morning, the metal has soared past $10,200/tonne, with some analysts predicting it will top $15K before too long. The copper price is a bellwether for the global economic recovery. But whenever I see the price of copper spike, I think of all those houses of worship that have to figure out how to keep copper thieves off their property—like this church in Kenya where thieves recently made off with a 500kg bell.
My wife and I have an appointment to get COVID vaccination No. 1 tomorrow. We’re bullish on a return to some sense of normalcy, and, for us, that starts with the jab.
Stay safe, everyone.
Have a nice weekend, everyone. I’ll see you back here on Monday… But first, there’s more news below.
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Losing $COIN. Coinbase Global closed in the red yesterday for the fourth straight day, sinking ever closer to its $250 direct-listing price. The slump comes as investors are turning to alt coins like Binance coin and Dogecoin, which the Coinbase exchange—oops—doesn't offer.
Policing greenwashing. The SEC has a lot on its plate: meme-stock rallies, the Archegos collapse. And, you can add companies' warm and fuzzy environmental, social, and governance (ESG) claims. Richard Morrison, a research fellow at the Competitive Enterprise Institute, writes that while the markets sorely need "more universal and verifiable" ESG metrics, any crackdown could cause problems of their own for investors.
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Quote of the day
The crypto run this time has two features the 2017 version didn’t—institutional adoption and actual applications.
That's Ben Carlson of Ritholtz Wealth Management and a frequent Fortune contributor. He explains what's behind the Ethereum bull run, and why it may have sturdier legs than the ETH rallies of 2017.
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