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Trading Radar: GDP, Non-Farm Payrolls, and ECB Rate Decision Will Move Markets

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Today's financial recap and tomorrow's financial outlook.

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Equity prices made a rounding peak on Wednesday of this week. The monetary policy statement from the FOMC was slightly more hawkish than had been expected by the markets. Equity and bond prices suffered as a result. Economic data throughout the week was mostly worse than expected, but the regional Chicago and national ISM manufacturing surveys showed exceptionally strong growth.

Looking ahead to next week there are four major economic data releases. On Tuesday is the national ISM services survey. The employment component of this survey is highly correlated with the non-farm payrolls report scheduled for Friday. Another is the advance estimate of third quarter GDP on Thursday morning. This report was initially scheduled for release this past week. Economists are expecting 1.9% real annualized GDP growth and 3.3% nominal growth. If those estimates are correct, nominal growth from a year ago will be 2.7%.

September's personal income and spending report is due out on Friday, which could alter the next estimate of third quarter GDP. Consumer spending is expected to increase moderately, but auto sales and retail sales were low for the month so the risk is for a miss to the downside. Lastly, Friday will bring the October non-farm payrolls report. Estimates have been taken down to a net growth of 128,000 after last month missed at 148,000 versus 180,000 economist estimates. The ADP private payrolls report showed 130,000 net growth in October. The ADP report is typically 7,000 to 9,000 less than nonfarm private payroll growth.

The ECB's monthly rate decision is on Thursday. Following a four-year low in consumer inflation growth this past week a number of investment banks speculated that the ECB would take action to ease financial condition through a rate cut or new long-term collateralized bank loans. Two months ago, Mario Draghi became the first central banker in a long, long time to downplay positive economic data as being due to "seasonally good weather." Typically, companies blame seasonally bad weather for poor earnings figures, so this was definitely a first.

Earnings season has mostly come to a close for major companies. Notable reports for the next week include Walt Disney (NYSE:DIS), Tesla (NASDAQ:TSLA), Chesapeake Energy (NYSE:CHK), Qualcomm (NASDAQ:QCOM), Whole Foods Market (NASDAQ:WFM), CBS (NYSE:CBS), Priceline.com (NASDAQ:PCLN), and Lions Gate (NYSE:LGF).

Monday, November 4

US Economics (Time Zone: EDT)

09:45 ISM New York – prior 53.6
10:00 Factory Orders Aug & Sep – Sep consensus 1.8%
11:00 Fed to purchase $3b-$4b notes in 6 to 7-year range
11:30 Treasury selling $33b 3-month bills, $29b 6-month bills

Fedspeak

11:40am Board of Governors Powell speaks in San Fran
4:00pm Rosengren speaks in Boston

Global Economics (Time Zone: GMT)

00:30 AUD Retail Sales
09:00 EUR Eurozone manufacturing PMI (final estimate)
09:30 GBP Construction PMI

Earnings

Before:
Kellogg (K)

After:
Office Depot (ODP)
OfficeMax (OMX)
Goodrich Petroleum (GDP)
Marathon Oil (MRO)
Pioneer Natural Resources (PNR)
Plains All American Pipeline (PAA)
Hertz Global (HTZ)
CF Industries (CF)

Tuesday, November 5

US Economics (Time Zone: EDT)

10:00 ISM Services – consensus 54.0, prior 54.4
10:00 IBD/TIPP Economic Optimism – consensus 41.8, prior 38.4
11:00 Fed to purchase $1.25b-$1.75b bonds in 23 to 30-year range
11:30 Treasury selling 4-week bills

Fedspeak

1:15pm Lacker speaks in North Carolina
5:00pm Williams speaks in San Fran

Global Economics (Time Zone: GMT)

01:45 CNY HSBC/Markit Services PMI
03:30 AUD RBA Rate Decision
08:15 CHF CPI
09:30 GBP Services PMI
10:00 EUR PPI
21:45 NZD Employment Change
7:45am Kuroda holds a news conference in Osaka
12:30pm Draghi speaks in Frankfurt

Earnings

Before:
Emerson Electric (EMR)
CVS Caremark (CVS)
Regeneron Pharma (REGN)
DIRECTV (DTV)
HCA Holdings (HCA)
T-Mobile (TMUS)

After:
21st Century Fox (FOXA)
Frontier Communications (FTR)
Sturm & Ruger (RGR)
Fossil (FOSL)
Web.com (WWWW)
Tesla (TSLA)
OpenTable (OPEN)

Annaly Capital (NLY)
Mosaic (MOS)
AOL (AOL)
Zillow (Z)

Wednesday, November 6

US Economics (Time Zone: EDT)

07:00 MBA Mortgage Applications
07:30 Challenger Job Cuts – prior +19.1%
10:00 Leading Economic Index – consensus 0.6%, prior 0.7%
11:00 Fed purchasing $2.75b-$3.5b notes in 7 to 10-year range

Fedspeak

1:10pm Pianalto speaks in Ohio

Global Economics (Time Zone: GMT)

JPY BoJ Oct Minutes
00:30 AUD Trade Balance
09:00 EUR Eurozone Services PMI (final estimate)
09:30 GBP Industrial and Manufacturing Production
10:00 EUR Eurozone Retail Sales
13:30 CAD Building Permits
10:30 Germany selling EU4b 10-year notes

Earnings

Before:
Time Warner (TWX)
Chesapeake Energy (CHK)
HollyFrontier (HFC)
Carlyle Group (CG)
Devon Energy (DVN)
Humana (HUM)
Duke Energy (DUK)
Ralph Lauren (RL)

After:
Qualcomm (QCOM)
EOG Resources (EOG)
CBS (CBS)
Whole Foods Market (WFM)
Prudential Financial (PRU)
Activision Blizzard (ATVI)
Tesoro (TSO)

NYSE Euronext (NYX)
Gulfport Energy (GPOR)
Nationstar Mortgage (NSM)

Thursday, November 7

US Economics (Time Zone: EDT)

08:30 Initial Jobless Claims - consensus 335k, prior 340k
08:30 Continuing Claims – consensus 2879K, prior 2881K
08:30 3Q Advance GDP – consensus 1.9%, prior 2.5%
08:30 Personal Consumption – consensus 1.6%, prior 1.8%
08:30 GDP Price Index – consensus 1.4%, prior 0.6%
08:30 Core PCE QoQ – consensus 1.5%, prior 0.6%
3:00 Consumer Credit – consensus $12.1B, prior $13.625B
11:00 Fed to purchase $1.25b-$1.75b bonds in 23 to 30-year range

Fedspeak

1:50pm Stein speaks in Chicago

Global Economics (Time Zone: GMT)

00:30 AUD Employment Change
05:00 JPY Leading Index
11:00 EUR German Industrial Production
12:00 GBP BoE Rate Decision
12:45 EUR ECB Rate Decision
8:30 Spain selling 5, 10, and 13-yr notes
8:50 France reopening 11, 32-yr bonds

Earnings

Before:
Wendy's (WEN)
Walter Investment Management (WAC)
Apollo Global (APO)
Starwood Property Trust (STWD)
Apache (APA)

After:
Walt Disney (DIS)
Stifel Financial (SF)
Monster Beverage (MNST)
Priceline.com (PCLN)
Arena Pharmacueticals (ARNA)
Nvidia (NVDA)
Tumi Holdings (TUMI)
Groupon (GRPN)
FireEye (FEYE)

Cablevision (CVC)
Rocketfuel (FUEL)

Friday, November 8

US Economics (Time Zone: EDT)

08:30 Non-farm Payrolls – consensus 125K, prior 148K
08:30 Private Payrolls – consensus 128K, prior 126K
08:30 Manufacturing Payrolls – consensus 5K, prior 2K
08:30 Unemployment Rate – consensus 7.3%, prior 7.2%
08:30 Average Hourly Earnings YoY – consensus 2.4%, prior 2.1%
08:30 Personal Income – consensus 0.3%, prior 0.4%
08:30 Personal Spending – consensus 0.2%, prior 0.3%
08:30 PCE Deflator YoY – consensus 1.0%, prior 1.2%
08:30 PCE Core YoY – consensus 1.3%, prior 1.2%
09:55 UofM Consumer Confidence – consensus 74.5, prior 73.2
11:00 Fed purchasing $4.75b-$5.75b notes in 5 to 6-year range

Fedspeak

12:00pm Lockhart speaks in Mississippi
3:30pm Bernanke speaks at IMF in Washington
6:00pm Williams speaks in LA

Global Economics (Time Zone: GMT)

Japan Investors Buying of Foreign Stocks/Bonds
06:45 CHF Unemployment Rate
08:15 CHF Retail Sales
09:30 GBP Trade Balance
13:15 CAD Housing Starts

Earnings

Before:
Lions Gate (LGF)
Leap Wireless (LEAP)


Twitter: @MichaelSedacca

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