MORNING BID EUROPE-UK's Labour's making losses in local vote

* A look at the day ahead from European Economics and Politics Editor Mark John and Nigel Stephenson, specialist editor, EMEA markets. The views expressed are their own.

LONDON, May 6 (Reuters) - Partial results from the UK's local elections are coming in, with the outcome of the London mayoral election due around 1700 gmt. The opposition Labour Party has made losses, but did not do as badly as some had feared, and will hope to gain some respite by winning the capital. There will be the inevitable spotlight on what this means for Jeremy Corbyn's leadership -- we're watching closely at how his critics within the party react.

MARKETS AT 0645 GMT

World stocks are on track for their worst week since mid-February so there is particularly keen interest in monthly U.S (Other OTC: UBGXF - news) . jobs data out at 1230 GMT. We have seen mixed U.S. economic numbers of late and this week began with some sub-par factory activity data from China and elsewhere. Stocks have fallen in Europe, Asia and the United States and German bond yields are on track for their biggest weekly fall since February. U.S. non-farm payrolls are forecast to have risen 202,000 in the latest month, although initial jobless claims on Thursday showed their biggest gain in more than a year on Thursday. With (Other OTC: WWTH - news) labour markets data seen as important for the Fed's policy outlook, investors are pretty cautious ahead of the payrolls release.

European shares are expected to fall 0.2-0.6 percent. ArcelorMittal (LSE: 0NSF.L - news) said it was more positive about the steel market, with a modest improvement in the outlook for China, though it kept its own forecast for 2016 earnings unchanged. First (Other OTC: FSTC - news) -quarter core profit was slightly above estimates. A Brazilian judge on Thursday ratified the settlement Samarco and its owners, BHP Billiton and Vale, signed with Brazil's government in March to cover damages for a deadly dam spill last year. Spanish wind turbine maker Gamesa's recurrent operating profit rose more than expected in the first quarter to 119 million euros, up 81 percent from a year earlier, helped by rising sales. InterContinental Hotels (Other OTC: ICHGF - news) posted a 1.5 percent rise in first-quarter global room revenue and said it was confident for the rest of the year, citing current trading trends and brand momentum; Monte dei Paschi (Milan: BMPS.MI - news) said first-quarter net profit beat forecasts due to lower loan loss charges, an increase in commissions and falling costs, but customer deposits fell by 5.6 percent in the first quarter as concerns about its mountain of bad loans and collapsing share price saw people withdraw their cash.

Upcoming data/events/themes for market reports on Friday:

- U.S. non-farm payrolls 1230 GMT, f'cast +202K

- S&P reviews Turkey

- Moody's reviews Portugal (Editing by Sonya Hepinstall)