Trading Radar: GDP, Non-Farm Payrolls, and ECB Rate Decision Will Move Markets
Today's financial recap and tomorrow's financial outlook.
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
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
Office Depot (ODP)
Goodrich Petroleum (GDP)
Marathon Oil (MRO)
Pioneer Natural Resources (PNR)
Plains All American Pipeline (PAA)
Hertz Global (HTZ)
CF Industries (CF)
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.