E-Mini futures for the S&P 500 retreated 0.5 percent in early action, while gold rose 0.77 percent to $ 1,739 an ounce. Oil prices also slipped, while sovereign bonds picked up the usual safe-haven bid. MSCI’s broadest index of Asia-Pacific shares outside Japan edged up 0.2 percent as did Japan’s Nikkei. “If American consumers were reluctant to come out of their Covid19 lockdown cocoon, fearing a secondary spreader with police cars ablaze, freeways blocked, and videos of mass looting shared through social media like wildfire, they’re not going to feel any safer,’ said Stephen Innes, chief global markets strategist at AxiCorp.
The May jobs report due out on Friday is forecast to show the unemployment rate surged to 19.8%, smashing April’s record 14.7 percent.
Payrolls are expected to drop by 7.4 million, on top of the 20.5 million jobs lost the previous month.
“Current unemployment numbers go far beyond what has been experienced in any post-war recession,” wrote Barclays economist Christian Keller in a note.
“To the extent that some sectors may never return to pre-pandemic business-as-usual, labour faces a substantial challenge to reallocate workers,” he added. “Such a process could be a matter of years rather than months or quarters and in the meantime it would weigh on consumer demand.”
FOLLOW OUR LIVE UPDATES HERE:
5.53am update: Pandemic set to shrink Australian economy in first quarter with worse yet to come
Australia’s economy is expected to have shrunk in the first quarter as the global coronavirus pandemic is set to tip the country into its first recession in three decades.
A Reuters poll of 15 economists forecast the A$ 2 trillion economy to contract by 0.3 percent in the three months to March – the first quarterly decline in nine years.
Annual growth likely slowed to 1.4 percent from 2.2 percent in 2019, the survey showed.
If the economy contracts in both the March and June quarters it would be Australia’s first technical recession since the early 1990s.