The Globe and Mail

Here's Allan Robinson's At The Bell which you'll find in tomorrow's newspaper:

Job losses continue to mount in the United States, causing the unemployment rate to inch up, and for investors, the losing sectors have been easy to spot.

The U.S. unemployment rate is forecast to rise to a three-year high of 5.2 per cent in April, up from 5.1 per cent in March, according to a survey of economists by Bloomberg.

WHAT ARE THE EXPECTATIONS?

Non-farm payrolls are expected to shrink by 75,000 in April, compared with 80,000 in March, while job losses in the manufacturing sector are forecast at 35,000, from 48,000.

About the only bright spot is the rate of job losses being suffered by the economy at least appears to be declining, if the forecasts prove to be accurate.

“Construction remains a sinkhole for workers,” followed by factories, the retail trade and financial services, according to BMO Nesbitt Burns Inc. Better job opportunities are in health care, food services and accommodation, and in government, it said.

However, investment dealers such as Merrill Lynch & Co. Inc. and UBS Securities LLC are looking for job losses of 90,000 and 100,000, respectively, which would be significantly worse than the Bloomberg consensus.

WHAT ELSE TO KEEP AN EYE ON

For investors in commodity producers, it has not been the job or economic weakness south of the border that has hurt commodity prices recently. Instead it is the rally in the U.S. dollar now that the U.S. Federal Reserve Board is seen to be on the sidelines with interest rate cuts.

“In the last few days, we have had some economic indicators better than expected, but still not particularly strong,” said Bart Melek, a global commodities strategist for BMO Nesbitt Burns. “The broad selloff in copper, oil and gold is in reaction to what is turning out to be a robust U.S. dollar rally.”

The U.S. dollar yesterday rose 1.2 and 1.1 per cent, respectively, against the euro and the Canadian dollar. The weakness in the latter currencies has been attributed to the chance of rate cuts by their central banks and some improvement in the U.S. credit markets.

Speculative interests have been using commodity positions as a hedge against U.S.-dollar weakness, Mr. Melek said. “Some of the speculative froth is being blown off. Still, all in all, taking the day-to-day noise out of the equation, the markets are still tight for all of those commodities, which are at darn good prices.”