Key Factors : November jobless figures, consumer credit updates, and earnings announcements from companies like Broadcom, Lululemon, GameStop, and others
- This week will provide the most recent information on the labor market to observers, as new data on employment growth, unemployment, hourly pay, job openings, and payrolls from the private sector will be released.
- “Meme stock” GameStop will release its first financial statement following Ryan Cohen’s appointment as CEO.
- Advanced Micro Devices will present its newest artificial intelligence processor, and Cisco Systems and Microsoft will have their yearly shareholder conferences.
Key Factors
Weekly Economic calendar USA JAN 01 to 05th
Monday
Tuesday
- S&P final U.S. manufacturing PMI (December)
- Construction spending (November)
- Atlanta Fed GDPNow release (Fourth quarter)
- Canada Manufacturing PMI.
Wednesday
- Job openings (November)
- ISM Manufacturing Purchasing Managers Index (PMI) (December)
- Federal Open Market Committee minutes released (Dec. 12-13 meeting)
- FOMC Minutes.
Thursday
- Initial jobless claims (Week of Dec. 30)
- ADP employment (December)
- S&P final U.S. Manufacturing PMI (December)
- China Caixin Services PMI,
- US Challenger Job Cuts,
- Canada Services PMI.
Friday
- U.S. employment report (December)
- ISM Services PMI (December)
- Factory orders (November)
- Eurozone CPI
- Canada Labour Market report
- US NFP
- US ISM Services PMI.
TOP FACTORS IN WALL STREET
FOMC Meeting Minutes
Globally, all eyes will be on the FOMC minutes from the December 2023 Federal Reserve meeting. Market players will be looking for clues about potential rate reduction in 2024.
The US Federal Reserve left the fed funds rate constant at 5.25-5.50 percent for the third meeting in a row in December, while hinting at three rate decreases (total 75 basis points) in 2024, owing to declining inflation. Economic growth is expected to reach 2.6 percent in 2023, up from 2.1 percent before, but 1.4 percent in 2024, down from 1.5 percent previously projected.
Fed Examining Employment Data to Assess Inflation Battle
Market observers will be examining a plethora of labor market statistics this week to ascertain whether the employment market is resilient in the face of the Federal Reserve’s interest rate hikes, following another decline in inflation last week. The Fed’s rate hikes are having an impact, as evidenced by the rising inflation statistics. Making sure that the higher-rate environment doesn’t have an undue negative impact on employment will be the next stage.
The employment data from last month also indicated that the Fed’s priorities were being met. Employers added 150,000 positions in October, according to the report, which was roughly 20,000 fewer than economists had predicted.
It came after a strong September jobs report showing companies adding 297,000 positions, which sparked concerns that inflation would remain high due to the labor market’s ongoing strength. The statistics from last month also revealed that hourly earnings increased by 0.2%, which is the lowest growth since February 2022 and suggests that inflation may be slowing down.
When the Bureau of Labor Statistics delivers the November employment numbers on Friday, officials from the Federal Reserve will be searching for more steady job growth. Market observers will also be observing data on hourly wage growth and the total unemployment rate, which increased slightly to 3.9% last month, in addition to the number of new positions created.
Weekly Global Market Calendar (11 Dec-15 Dec)
Monday, JAN 01
- HOLIDAY
Tuesday,JAN 02
- China Caixin Manufacturing PMI
- Canada Manufacturing PMI.
Wednesday, JAN 03
- Switzerland Manufacturing PMI,
- US ISM Manufacturing PMI,
- US Job Openings,
- FOMC Minutes.
Thursday, JAN 04
- China Caixin Services PMI,
- US Challenger Job Cuts,
- US ADP,
- US Jobless Claims,
- Canada Services PMI.
Friday, JAN 05
- Eurozone CPI
- Canada Labour Market report
- US NFP
- US ISM Services PMI.
Global Events in details date wise
Tuesday JAN 02
US PMI for Manufacturing ISM
The anticipated US ISM Manufacturing PMI is 47.1, up from the previous 46.7. According to the most recent data, the index continued to decrease in November, and the overall assessment was somewhat negative. December’s bad news kept coming in the form of the US S&P Global Manufacturing PMI, which fell short of forecasts and confirmed the manufacturing sector’s negative impact on the economy.
US job openings
Compared to the previous 8.733M, 8.850M US job openings are anticipated. Job Openings declined significantly more than anticipated in the most recent data, which had the lowest reading since March 2021. The soft-landing narrative is reinforced by the fact that the labor market is still softening, with fewer jobs available rather than more layoffs. This is in line with the declining pace of inflation. Time will tell if the “most crowded trade on Wall Street” was, in fact, the right one all along as these incidents usually precede recessions.
Thursday JAN 04
US ADP
It is anticipated that the US ADP would report 113K new jobs in December, up from 103K in November. Expectations were not met by the previous report, and naturally, the NFP report that followed gave us a complete and utter beating. This announcement may move the market and provide some general insight into the US labor market, even though it is essentially useless for predicting the NFP number.
US Unemployment Claims
Every week, one of the most significant publications is the US Jobless Claims, which is a timely indicator of the status of the US labor market. While Initial Claims continue to linger near cycle lows, indicating that layoffs have not significantly increased, Continuing Claims have been rapidly increasing, suggesting that workers are having difficulty finding new employment following layoffs. Initial claims are forecast to be 215K this week, compared to 218K last week, while continuing claims are predicted to be 1882K, compared to 1875K last week.
Friday JAN 05
The Unemployment Rate in Canada
According to the Canadian Labour Market data, there were 12K new positions added in December as opposed to 24.9K in November, and the unemployment rate increased to 5.9% from 5.8% in November. This report is unlikely to have an impact on the BoC’s January decision because, particularly in light of the most recent, higher-than-expected inflation report, the central bank may wait to make a decision until it has more data from Q1. You can read Adam’s articles on the Bank of Canada and the Canadian Dollar to learn more about the prospects for Canada in 2024.
Eurozone Core CPI YoY
While the Core Y/Y measure is seen at 3.5% vs. 3.6% prior, the Eurozone Headline CPI Y/Y is anticipated to be 3.0% vs. 2.4% before. The first 25 bps of the projected 160 bps in rate reductions in 2024 are priced in by the market in April. The officials agree that they should wait for Q1 data before determining whether a rate cut in Q2 is actually required, as the ECB members have been resisting the aggressive market pricing. The ECB can already declare its “mission accomplished” based on the M/M inflation readings, and in Q2 2024, we may already see the Y/Y inflation rates drop below 2%.
US Unemployment Rate
The US NFP is predicted to reveal 163K new jobs added in December, up from 199K in November, and a little increase in the unemployment rate to 3.8% from 3.7% previously. With the M/M reading at 0.3% vs. 0.4% prior and the Y/Y measure predicted at 3.9% vs. 4.0% prior, the average hourly earnings are predicted to cool even more. The markets’ reaction function has shifted from “strong data equals more rate hikes” to “strong data equals less rate cuts” as a result of the main central banks ending their tightening cycles.
US PMI for ISM Services
The anticipated US ISM Services PMI is 52.6, down from the previous 52.7. Given that the US services sector is less sensitive to rate increases, the November report exceeded expectations. The figures from the December S&P Global Services PMI, which ended the year with the highest growth since last July, exceeded forecasts and further confirmed this trend.
WEEKLY EARNINGS CALENDAR
Wednesday, JAN 03
UniFirst (UNF) and Cal-Maine Foods Inc. (CALM)
Thursday, JAN 04
Walgreens Boots Alliance (WBA), Conagra Brands (CAG) and Simply Good Foods Co. (SMPL)
Friday, JAN 05
Constellation Brands (STZ)
For details
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