Trading Radar: Nonfarm Payrolls and the Bank of Japan

By Michael Sedacca  MAR 28, 2013 10:55 AM

Economics, earnings reports, and market events for the week ahead.

 


US markets continued to bounce around in response to developments in Cyprus. Today the Cyprus banks reopened for business. While long lines did not form to pull cash from the bank, we'll have to wait and see what kind of deposits were withdrawn electronically. Economic data for the week was a bit weaker than was desired with durable goods orders ex-transports, consumer confidence, Chicago manufacturing, and annual pending home sales all ticking down. Bullish data for the week was provided by Case-Shiller home prices, but this data is a bit stale since it is from January.

Looking ahead, next week is jobs week with nonfarm payrolls on Friday and ADP employment change on Wednesday. Though regional surveys' employment subindex and weekly jobless claims have ticked up recently, economists are still expecting a strong month of 190,000 in payrolls gain. Wednesday's ADP report, which is now a better indicator after the company changed its survey methods in October of last year, is expecting to see 198,000 in private payrolls. Lastly, the ISM manufacturing estimates point to an unchanged month at 54.2. This is probably a bit optimistic as regional manufacturing surveys have been weaker lately.

Globally, the focus will be on the central banks. The Bank of Japan will conduct its first policy meeting since Haruhiko Kuroda took over as governor. His commentary since being appointed governor has been incredibly dovish so expectations are very high going into the meeting. He will likely lengthen the maturity of purchases of Japanese government bonds, increase the size, and possibly begin purchasing stocks and corporate bonds. This is ahead of the current plan's schedule, which is projected to begin in late 2013 to early 2014. The Bank of England is unlikely to lower rates and probably won't increase its asset purchase program until next month, but current Governor Mervyn King has certainly tried to sway the other members on the Monetary Policy Committee to do so. Lastly, the fan favorite, the ECB, is set to release its monetary decision on Thursday. Any change is unlikely as last month's comments failed to include any comments on the price of the euro, but some color on the Cyprus situation and the future of Luxembourg and Malta is to be expected.

The earnings calendar is very empty as first-quarter earnings won't begin to trickle out until later in the month. The only notable reports for the week are from Monsanto (NYSE:MON) and ConAgra Foods (NYSE:CAG).


Monday, April 1

US Economics (Time Zone: EDT)

08:58 Markit US PMI Final - consensus 55.2
10:00 Construction Spending - consensus 0.8%, prior -2.1%
10:00 ISM Manufacturing - consensus 54.2, prior 54.2
10:00 ISM Prices Paid - consensus 59.5, prior 61.5
11:00 Fed buying $2.75b-$3.5b notes in 7 to 10-year range
11:30 Treasury selling $35b 3-month bills, $30b 6-month bills

Global Economics (Time Zone: GMT)

JPY Tankan Manufacturing Indexes
01:00 CNY Manufacturing PMI
01:45 CNY HSBC Manufacturing PMI

Earnings

No major earnings


Tuesday, April 2

US Economics (Time Zone: EDT)

09:45 ISM New York - prior 58.8
10:00 Factory Orders - consensus 2.5%, prior -2.0%
10:00 IBD/TIPP Economic Optimism - prior 42.2
5:00 Vehicle Sales - consensus 15.30M, prior 15.33M
5:00 Domestic Vehicle Sales - consensus 12.04M, prior 11.99M
11:00 Fed to buy $1.25b-$1.75b notes in 23 to 30-year range
11:30 Treasury selling 4-week bills, $25b 52-week bills

1:30 Fed's Lockhart speaking in Alabama
7:30 Fed's Evans and Lacker speaking in Virginia

Global Economics (Time Zone: GMT)

03:30 AUD Reserve Bank of Australia Decision
07:30 CHF SVME PMI
08:00 EUR Eurozone Manufacturing PMI
08:30 GBP Manufacturing PMI
09:00 EUR Eurozone Unemployment Rate
12:00 EUR German CPI

Earnings

No major earnings

Wednesday, April 3

US Economics (Time Zone: EDT)

07:00 MBA Mortgage Index
08:15 ADP Employment Change - consensus 198K, prior 198K
10:00 ISM Non-manufacturing Composite - consensus 56, prior 56
11:00 Fed buying $3b-$3.75b notes in 5.5 to 7-year range

3:30 Fed's Williams speaking in Los Angeles
5:00 Fed's Bullard lecturing in St. Louis

Global Economics (Time Zone: GMT)

01:00 CNY Non-manufacturing PMI
01:45 CNY HSBC Services PMI
08:30 GBP Construction PMI
09:00 EUR Eurozone CPI
10:30 Germany selling EU4b 5-year notes

Earnings

Before:
Monsanto (MON)
ConAgra Foods (CAG)


Thursday, April 4

US Economics (Time Zone: EDT)

07:30 Challenger Job Cuts - prior 7.0%
08:30 Initial Claims – consensus 340K, prior 336K
08:30 Continuing Claims – consensus 3042K, prior 3053K
11:00 Fed purchasing $1.25b-$1.75b notes in 23 to 30-year range

12:30 Fed's George speaking in Oklahoma
5:00 Yellen speaking in Washington

Global Economics (Time Zone: GMT)

JPY Bank of Japan Rate Decision
00:30 AUD Retail Sales
08:00 EUR Eurozone PMI (final estimate)
08:30 GBP Services PMI
09:00 EUR Eurozone PPI
11:00 GBP Bank of England Rate Decision
11:45 EUR ECB Rate Decision
8:30 Spain selling 3, 5, 8-year notes
8:50 France selling bonds

Earnings

No major earnings


Friday, April 5

US Economics (Time Zone: EDT)

08:30 Trade Balance - consensus -$44.6B, prior -$44.4B
08:30 Nonfarm Payrolls - consensus 190K, prior 236K
08:30 Private Payrolls - consensus 203K, prior 246K
08:30 Manufacturing Payrolls - consensus 10K, prior 14K
08:30 Unemployment Rate - consensus 7.7%, prior 7.7%
08:30 Avg Weekly Hourly Earnings - consensus 34.5, prior 34.5
3:00 Consumer Credit - consensus $16B, prior $16.151B

Global Economics (Time Zone: GMT)

05:00 JPY Leading Index
09:00 EUR Eurozone Retail Sales
10:00 EUR German Factory Orders
12:30 CAD Employment Figures

Earnings

No major earnings


Twitter: @MichaelSedacca

No positions in stocks mentioned.

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