US jobs day; Deutsche Bank watch; Markets stutter

Posted at 3:23 AM, Jul 05, 2019
and last updated 2019-07-05 07:16:27-04

1. Jobs day: The US Labor Department releases its jobs report for June at 8:30 a.m. ET.

Economists polled by Refinitiv expect the unemployment rate remained at a steady 3.6%, with the addition of 165,000 jobs. That would be better than the 75,000 jobs added in May, but a slight slowdown from the 175,000 positions created on average over the past six months.

Any sign of growing weakness could send stocks lower and bolster the case for a big interest rate cut from the Federal Reserve at the end of the month.

Other indicators, such as consumer sentiment and durable goods orders, have been dragged down in recent months, in part because of ongoing trade tensions.

2. Deutsche Bank watch: A beleaguered Deutsche Bank could be headed for big changes.

CEO Christian Sewing is reportedly preparing to ask his supervisory board to approve a dramatic overhaul of the German bank’s operations.

That could reportedly entail the creation of a €50 billion ($56 billion) “bad bank” for assets that eat up too much capital, as well as up to 20,000 job cuts as the bank steps away from key areas of investment banking.

Deutsche Bank declined to comment. Many of the cuts are expected to hit its US employees. Deutsche Bank employs almost 9,300 people in North America, with most of those jobs in the United States.

3. Markets stutter: US stock futures point lower as traders return from the July 4 holiday.

The Dow is set to open down 40 points, or 0.2%. The Nasdaq and S&P 500 are poised for similar losses.

Stocks in Asia were mixed. Hong Kong’s Hang Seng fell 0.1%, but Japan’s Nikkei and the Shanghai Composite both rose 0.2%.

European markets opened lower. Germany’s DAX fell 0.3% in early trading after a dismal batch of data on factory orders. Britain’s FTSE 100 is off 0.4%.

On the radar: the UK antitrust watchdog has put Amazon’s investment in Deliveroo on hold while it looks at whether its stake in the food delivery startup is actually a takeover effort.

A move lower for US stocks would follow a session in which all three major stock indexes reached record highs.

The Dow closed up 0.7% at 26,966 points on Wednesday. The S&P 500 rose 0.8% to 2,996 points, and the Nasdaq finished 0.8% higher at 8,170 points.

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4. Coming this week:
Friday — US jobs report