Watch For:

U.S. Employment Report for November; U.S. Factory Orders for October; Canada Labor Force Survey for November; Canada International Reserves for November; Bank of Montreal 4Q earnings.

Opening Call:

Stock futures wobbled, while oil prices continued to rise after OPEC and a group of Russia-led oil producers agreed to continue pumping more crude.

Investors are grappling with the unclear impact of Omicron for the global economy. The variant has triggered fresh restrictions around the world, throwing up new obstacles to overseas travel just as it was starting to bounce back from last year's Covid-19 measures. Scientists are trying to gauge how effective current vaccines will be against the variant.

"What we see now this week since we had the Omicron news is extremely high volatility and extreme nervousness in markets," said Carsten Brzeski, ING Groep's global head of macro research. He expects this to continue until more is known about Omicron.

Brent crude futures, the benchmark in global oil markets rose after OPEC and a group of Russia-led oil producers agreed Thursday to continue pumping more crude, betting that pent-up demand in a post-lockdown world would outweigh any hit to economic activity from the recent Covid-19 permutations.

But the group said its session would remain open, a technical move that would allow it to reconvene quickly and change course if the Covid-19 situation changes dramatically.

Investors are awaiting data at 8:30 a.m. ET on how many jobs U.S. employers added in November. Employers say they are eager to hire from a depleted pool of workers, leading to increased bargaining power and rising wages for many employees.

A strong rebound in the labor market could impact the Federal Reserve's timeline for paring back some of its monetary policy support that has supported asset prices.

"After a week of mixed macro news, some stronger news would be good for the market," Mr. Brzeski said.

Stocks to Watch:

Shares of DocuSign were sinking in premarket trading Friday after the e-signature software company issued a fourth-quarter forecast that missed estimates.

Analysts at Citigroup said DocuSign "delivered one of the biggest [Software as a Service] whiffs in recent memory."

The company said it expects revenue for the fiscal fourth quarter ending Jan. 31, of $557 million to $563 million, below analysts' expectations of $573.8 million. DocuSign expects fourth-quarter billings of $647 million to $659 million. Analysts were forecasting fourth-quarter billings of $705.4 million, according to FactSet.

Tesla's China business is recalling 21,599 locally made Model Ys due to issues with auto parts from suppliers.

The company has filed the recall plans with China's top market regulator, according to a notice posted Friday by an affiliate of the State Administration for Market Regulation.

A component known as a steering knuckle, which allows the wheels to turn, might be deformed or break while the car is in use, increasing the risk that an accident could occur, the notice said.

Tesla Shanghai will carry out related checks on the affected vehicles for free and replace substandard steering knuckles, the regulator said.

The recall, which affects vehicles manufactured between Feb. 4 and Oct. 30, isn't the first time the company has had to deal with safety issues in the world's largest auto market.


The dollar could receive a further boost from U.S. nonfarm payrolls data, particularly after Federal Reserve Chair Jerome Powell said earlier this week that inflation no longer looks transitory, ING said.

Strong data would add to the view that the Fed could remove monetary stimulus more quickly, it said.

"Any sharper than expected drop in the unemployment rate (3.8% has been suggested as a metric for full employment and the start of tightening) or sharper rise in average hourly earnings (e.g. more than 0.4% month-on-month) could drive the dollar higher today."

The consensus in a WSJ poll is for nonfarm payrolls to rise by 573,000 and an unemployment rate of 4.5%.

The Turkish lira fell after ratings agency Fitch downgraded the country's outlook to "negative" from "stable" and following data that showed inflation accelerated.

Fitch said premature interest rate cuts and the prospect of further easing have weakened domestic confidence, reflected in the lira's sharp depreciation and rising inflation, which create risks to macroeconomic and financial stability and could re-ignite external financing pressures.

Data on Friday showed consumer prices jumped 21.31% year-on-year in November after rising 19.89% in October.

With no signs President Recep Tayyip Erdogan will permit large rate rises, the lira will struggle to recover and inflation will remain very high through most of the next six-to-nine months, Capital Economics economist Jason Tuvey said.


In bond markets, the yield on the benchmark 10-year Treasury note ticked down to 1.446% from 1.447% Thursday.

Within a year, the monetary policy environment changed from "QE infinity" and "lower interest rates for longer" to one characterized by a global, generalized and rapid rise in interest rates, said Gergely Majoros, member of Carmignac's investment committee.

With this backdrop, Carmignac remains "very cautious" on core sovereign bonds and very selective in corporate bonds, while it sees value niches in emerging-market bonds and equity markets, he said.

Majoros said that in an environment where inflation should persist longer, Carmignac's risk management focuses on an active management of duration exposure, cash and short-term instruments which are the most suited in episodes of volatility, and the USD given its safe-haven status and dynamics.

Pimco maintains a positive view on spread securities from the eurozone periphery, especially Italy, while focusing on receiving adequate compensation for policy uncertainty, Konstantin Veit, portfolio manager and head of European rates, said.

Given the euro area's unique institutional structure and uneven macroeconomic conditions, Pimco expects yields in the region to remain relatively more anchored than elsewhere in the world, and Pimco therefore is positioned rather independently from benchmark indexes with a view to overall duration, he said.

"While starting valuations offer limited room for spread tightening and the macroeconomic outlook remains highly risky, a less crisis-prone euro area generally bodes well for risky assets," he said.


Brent crude oil rose after OPEC+ pressed ahead with plans to raise oil production by 400,000 barrels a day in January despite the emergence of the Omicron coronavirus variant and the recent move by oil consuming nations to tap strategic reserves.

Prices fell after the decision on Thursday but then rebounded on the day and continue higher Friday.

Goldman Sachs's Damien Courvalin points to the alliance's promise to immediately adjust their plans should the situation require it. Similarly, while OPEC+ will raise production in January, the small increase exacerbates "the long-term deficit...[and] we believe current price levels offer compelling opportunities to reposition for the ongoing structural bull market," he added.

London gold prices were flat, with the selloff in the precious metal appearing to lose steam. The prospect of the Fed tapering its asset-buying program has boosted the U.S. dollar this week, putting pressure on gold.

That is despite the rising risk aversion and asset selloffs that have come with the emergence of the Omicron coronavirus variant, said Oanda's Jeffrey Halley.

LME three-month copper futures were, after gentle losses on Thursday, with most metals prices moving higher as well.




Covid-19 Vaccine Demand Strains CVS, Walgreens

The U.S. has plenty of Covid-19 vaccines but retail pharmacies are struggling to quickly administer them in some places.

Vaccine seekers in some states face waits of days or weeks for doses as local health officials hustle to improve access to meet surging demand. CVS Health Corp., Walgreens Boots Alliance Inc. and Walmart Inc., which are facing staffing shortages, now say they may not be able to accommodate people without appointments.


Citigroup Applies for China Securities License

Citigroup Inc. has applied for a securities license in China, according to a person familiar with the matter, as the New York-based banking giant eyes a bigger presence in the world's second-largest economy.

The bank recently submitted its application to the China Securities and Regulatory Commission, the person said. Citigroup is also planning to apply for a futures license in the coming months and intends to hire around 100 people in mainland China in the next two years to support its expansion onshore, the person added.


Lyft Poaches Amazon Executive to Lead Its Finances

Lyft Inc. poached an Inc. executive to become its next finance chief, a change in the ride-hailing firm's C-suite that comes shortly after the company reached an important profitability milestone.

San Francisco-based Lyft on Thursday said Elaine Paul has been named chief financial officer, effective Jan. 3. Ms. Paul succeeds current CFO Brian Roberts, who is stepping down after seven years in the role but will stay on as an adviser until June 2022. His departure as CFO isn't the result of any disputes or disagreements, Lyft said in a filing with securities regulators.


Elon Musk's Tesla Share-Selling Spree Tops $10 Billion

Elon Musk has now unloaded more than $10 billion in Tesla Inc. stock as the billionaire's share-selling spree involving his holdings in the electric-vehicle maker stretched into a second month.

Mr. Musk on Thursday sold more than 934,000 Tesla shares valued at just over $1 billion, according to regulatory filings. The sales came as Mr. Musk exercised more than 2.1 million vested Tesla stock options.


Google Delays Required Return to Office for Employees

Alphabet Inc.'s Google said it is delaying its required return-to-office plans that were scheduled to start Jan. 10 at the earliest for U.S. offices.

The tech company said it would wait until next year to decide when its office-return plan will take effect, according to an email that Chris Rackow, Google's vice president of global security, sent to employees Thursday. Google's shifting office-reopening plans were earlier reported by CNBC.


Didi Global Plans to Delist From New York Stock Exchange

Didi Global Inc. plans to delist its shares in the U.S. and pursue a listing in Hong Kong, a dramatic reversal just months after the Chinese ride-hailing group's ill-fated initial public offering in New York.

The move, which Didi said Thursday was supported by its board, comes as authorities in Beijing wrap up a cybersecurity probe into the company. It would mark an escalation in the financial decoupling between the U.S. and China, which has already seen several Chinese companies expelled from American exchanges.


FTC Challenges Nvidia's Deal for Arm Holdings

WASHINGTON-The Federal Trade Commission on Thursday sued to block U.S. chip supplier Nvidia Corp.'s proposed landmark takeover of semiconductor-design specialist Arm Holdings, arguing the chip-industry deal is anticompetitive.

The lawsuit marks the beginning of what is likely to be an aggressive antitrust campaign by the FTC under the leadership of Chairwoman Lina Khan, a progressive tapped by President Biden in June to lead the agency.


November Likely Saw Strong Job Gains, but Omicron Threat Looms

Lower Covid-19 case numbers likely helped propel the U.S. economy and powered strong job gains in November, economists say, but the new Omicron variant could jeopardize that progress.

Economists surveyed by The Wall Street Journal estimate that employers added 573,000 jobs in November, roughly on par with October. The unemployment rate is expected to tick down to 4.5% from 4.6%. The Labor Department is schedule to release November employment figures at 8:30 a.m. Eastern time Friday.


Companies Cling to Libor as Key Deadline Nears

U.S. companies need to give up the London interbank offered rate for new debt at the end of December. Many want to close just one more deal before that.

Come Jan. 1, banks won't be able to issue new loans or other financial contracts using Libor, which underpins trillions of dollars in corporate loans, derivatives and home mortgages. They will, however, be able to keep referencing Libor for debt issued before the year-end deadline through June 2023.


Citigroup Applies for China Securities License

Citigroup Inc. has applied for a securities license in China, according to a person familiar with the matter, as the New York-based banking giant eyes a bigger presence in the world's second-largest economy.

The bank recently submitted its application to the China Securities and Regulatory Commission, the person said. Citigroup is also planning to apply for a futures license in the coming months and intends to hire around 100 people in mainland China in the next two years to support its expansion onshore, the person added.


A Couple Stored IRA Gold at Home. They Owe the IRS More Than $300,000.

It's official: Owners of individual retirement accounts with assets invested in gold and silver coins can't store them in a safe at their home.

So ruled the judge in a recent Tax Court case, Andrew McNulty et al. v. Commissioner. The decision will cost Mr. McNulty and his wife Donna dearly-taxes of nearly $270,000 on about $730,000 of IRA assets, plus penalties likely to exceed $50,000.


Asia-Pacific Nations Use Tougher Tactics to Combat Omicron Variant

Countries in the Asia-Pacific region are creating tougher rules for those infected with the Omicron Covid-19 variant, as governments move more aggressively than they have against all other previous iterations, including Delta.

The modifications come as Omicron begins to reach the Asia-Pacific region, with Australia, Hong Kong, India, Japan, South Korea, Singapore and Malaysia reporting confirmed cases. The initial moves focused on national travel restrictions and border tightenings.


Eurozone Retail Sales Rose in October, But Missed Expectations

Eurozone retail sales rose in October but failed to meet expectations, the European Union's statistics agency Eurostat said Friday.

The volume of retail sales increased 0.2% in October compared with the previous month, after a downwardly revised 0.4% decrease in September, Eurostat said. Economists polled by The Wall Street Journal had forecast a 0.3% increase for October.


Omicron's Severity Will Take More Time to Assess, Doctors Say

JOHANNESBURG-It is still too early to tell whether Covid-19 caused by the new Omicron variant is milder or more severe than that from other strains of the coronavirus, doctors tracking a rapidly growing outbreak in South Africa said Friday.

The country, which has more known Omicron cases than any other, is likely to be the first to deliver answers to the questions doctors and scientists have been grappling with since the World Health Organization declared the new strain a "variant of concern" a week ago. Key among those are whether Omicron makes those infected sicker, whether it is more transmissible and in how far current Covid-19 vaccines or a past infection protect against the variant.


Andrew Cuomo Under Federal Investigation Over Sexual-Harassment Allegations

The Justice Department opened a civil-rights investigation into former New York Gov. Andrew Cuomo's executive chamber after a state report found that he sexually harassed multiple women, people familiar with the matter said.

Lawyers working for the U.S. Attorney for the Eastern District of New York's Civil Division sent a letter to state officials before Mr. Cuomo left office in August that said they were examining employment policies in the executive chamber, according to people who reviewed the letter. The executive chamber includes the governor and his or her top aides and advisers.


U.S. to Lead Global Effort to Curb Authoritarians' Access to Surveillance Tools

WASHINGTON-The U.S. plans to work with other countries to limit exports of surveillance tools and other technologies that authoritarian governments can use to suppress human rights, an alleged practice in China.

The Biden administration said Thursday that it would launch an initiative with friendly nations to establish a code of conduct for coordinating export-licensing policies. The effort would also see participating nations share information on sensitive technologies used against political dissidents, journalists, foreign government officials and human rights activists, administration officials said.


Biden Administration Issues Cybersecurity Directives for Freight and Passenger Rail

WASHINGTON-Nearly all U.S. freight and passenger rail systems will be required to report certain cybersecurity incidents to the Department of Homeland Security within 24 hours of discovery under new directives published Thursday by the Biden administration.

The orders, issued under congressional authority given to the Transportation Security Administration, will affect about 90% of passenger rail systems in the U.S. and 80% of freight rail systems that are considered "higher risk," a senior Department of Homeland Security official said, meaning they are considered vital to economic and national security.


Senate Approves Spending Bill Averting Government Shutdown

WASHINGTON-Congress passed a short-term extension of government funding and sent the legislation to President Biden's desk, averting a partial shutdown after resolving a standoff over vaccine rules.

Top Republicans and Democrats reached an agreement on the spending plan Thursday morning to extend funding through Feb. 18, then quickly maneuvered the legislation through both the House and Senate before the expiration of current funding at 12:01 a.m. Saturday. The legislation also includes $7 billion for assisting evacuees from Afghanistan.




Bank of Montreal 4Q

Canadian Western Bank 4Q

Economic Indicators (ET):

0815 Nov Official International Reserves

0830 Nov Estimates of production of principal field crops

0830 Nov Labour Force Survey

0830 3Q Labour productivity, hourly compensation & unit labour cost

Stocks to Watch:

Canfor Pulp Products Announces Production Curtailments in Response to Supply Chain Challenges; Pulp Shipments Have Declined as a Result of Weather-Related Transportation Disruptions; Canfor Plans Minimum 2-Week Curtailment of NBSK Production at Northwood Pulp and a Minimum 4-Week Curtailment of Production of BCTMP at Taylor Pulp


Expected Major Events for Friday

00:01/UK: Nov BRC-Sensormatic IQ Footfall Monitor

00:30/JPN: Nov Japan Services PMI

06:00/RUS: Nov Russian Services PMI

07:45/FRA: Oct Industrial production index

08:45/ITA: Nov Italy Services PMI

08:50/FRA: Nov France Services PMI

08:55/GER: Nov Germany Services PMI

09:30/UK: Nov CIPS / Markit Services PMI

09:30/UK: Nov UK Official Reserves

09:30/UK: 3Q Bank of England external business stats

13:15/CAN: Nov Official International Reserves

13:30/CAN: 3Q Labour productivity, hourly compensation & unit labour cost

13:30/CAN: Nov November estimates of production of principal field crops

13:30/CAN: Nov Labour Force Survey

13:30/US: Nov U.S. Employment Report

14:45/US: Nov US Services PMI

15:00/US: Nov ISM Report On Business Services PMI

15:00/US: Oct Manufacturers' Shipments, Inventories & Orders (M3)

16:00/US: Nov Global Services PMI

All times in GMT. Powered by Kantar Media and Dow Jones.


Expected Earnings for Friday

ASA Gold & Precious Metals Ltd (ASA) is expected to report for 2Q.

Bank of Montreal (BMO,BMO.T) is expected to report $3.18 for 4Q.

Big Lots (BIG) is expected to report $-0.16 for 3Q.

Canadian Western Bank (CWB.T) is expected to report $0.83 for 4Q.

Esports Technologies Inc (EBET) is expected to report for 3Q.

Genesco (GCO) is expected to report for 3Q.

Hibbett Inc (HIBB) is expected to report $1.42 for 3Q.

Hugoton Royalty Trust (HGTXU) is expected to report for 3Q.

Outlook Therapeutics Inc (OTLK) is expected to report $-0.07 for 4Q.

Skillsoft Corp (SKIL) is expected to report for 3Q.

Unico American (UNAM) is expected to report for 3Q.

Powered by Kantar Media and Dow Jones.



BeyondSpring Cut to Hold From Buy by Jefferies

BeyondSpring Cut to Underperform From Buy by B of A Securities

Choice Hotels Intl Cut to Hold From Buy by Loop Capital

Columbia Financial Raised to Overweight From Neutral by Piper Sandler

CubeSmart Raised to Outperform From Market Perform by Raymond James

Expeditors International Cut to Underweight From Equal-Weight by Morgan Stanley

Ford Motor Cut to Peer Perform From Outperform by Wolfe Research

Graco Raised to Outperform From Market Perform by William Blair

Hibbett Sports Cut to Neutral From Buy by B of A Securities

Okta Raised to Overweight From Neutral by Piper Sandler

Public Storage Raised to Strong Buy From Outperform by Raymond James

This article is a text version of a Wall Street Journal newsletter published earlier today.


(END) Dow Jones Newswires

December 03, 2021 06:12 ET (11:12 GMT)

Copyright (c) 2021 Dow Jones & Company, Inc.