Tapering the taper talk
May 7 (Reuters) - A look at the day ahead from Thyagaraju Adinarayan.
A million or more jobs added in April won't be enough to trigger the Fed to ponder its bond purchases is what Atlanta Fed's President Raphael Bostic said on Thursday, but markets appear to be wanting to front run any potential tapering with the S&P 500 .SPX stopping just shy of record highs.
The non-farm payrolls report due later today is likely to set the tone for markets - especially U.S. Treasuries, which traded in a tight range this week. Estimates for jobs created in April range widely between 700,000 and more than 2 million.
The reflation trade has been the only game in town as vaccinations gather pace and that's also supporting the red-hot rally in commodities that shows no signs of abating with oil, iron ore and copper all rising sharply. And those markets will be underpinned by China extending its impressive trade performance in April with exports jumping a third and import growth at a decade high.
In more good news, earnings season is continuing to surprise on the upside in Europe and the United States. German sportswear company Adidas ADSGn.DE said it expects strong demand for its products despite supply chain issues and lockdowns in Europe. Similarly, Siemens SIEGn.DE raised its outlook even as it flagged tightening supply chains.
Those strong earnings prints are set help Europe's benchmark STOXX 600 .STOXX index to open at record highs. U.S. stock futures are also ticking higher.
Elsewhere, the world's second-largest cryptocurrency Ether ETH=BTSP hit yet another record high, taking year-to-date gains to over 385%, as investors diverted focus from its main rival bitcoin BTC=BTSP .
Key developments that should provide more direction to markets on Friday:
- Credit Agricole posts 64% jump in profits
- BMW confirms outlook, but says rest of 2021 to be volatile
- British Airways cautious on short term flying recovery
- ECB President Christine Lagarde speaks at 1000 GMT
- US non-farm payrolls data 1230 GMT
- US earnings: Cigna, Fluor
Cryptos explode to new highs Link
Reporting by Thyagaraju Adinarayan, editing by Karin
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