It was a good week in the market with the S&P 500 ($SPX) (SPY) finishing the week up just over 0.50% overall.
Core PCE came in slightly lower than expected but it didn’t goose the markets all the much as Friday just floated lower. From a high level, it looked a lot like rotation into the Russell constituents.
This week has us looking at a lot of potentially powerful news releases and Fed Chair Powell speaking on Monday to start the week off.
Here are 5 things to watch this week in the Market.
Powell
Powell is speaking on Monday at 1 pm Eastern at a conference in Nashville. This conference isn’t directly tied to rates or the economy in general, but he is almost always asked at least a question on how he sees everything from the Fed. Any rate discussions could cause some volatility as the market tries to piece together the odds of another cut and the magnitude of the cut.
ISM PMI’s
Both Manufacturing and Services PMI are due out this week with Manufacturing on Tuesday and Services on Thursday. Both of these are gauges of industry expansion and contraction and at this point in the rate cycle, it's possible that we are looking for expansion in both sectors. Given that they are a few days apart they are unlikely to influence each other's market response, so if one is good and one is bad they could have separate market effects.
JOLTS Job Openings
Tuesday Morning also has the JOLT's job openings out at 10 am. This is regularly something that gets pointed out and it's for good reason. Jobs are a fundamental driver in the economy, so while the actual release may or may not affect the market at that moment it can show if the underlying bases are getting stronger or weaker. That said, a beat could have us rally on a more fluid labor market and a miss could have us sell on a tightening job market.
ADP Non-Farm Employment
Wednesday has the ADP non-farm employment numbers out and this has a lot of movement potential. Similar to the government's number out on Friday this measures non-agriculture job growth. A strong release could mean a robust job market and cause the market to rally, while a weak release could have the opposite effect. Additionally, watch any prior month revisions as anything material could mean the underlying economy is weaker than anticipated.
Non-Farm Payrolls/Unemployment
Friday the government's numbers for non-farm workers are out and similar to the ADP number on Wednesday a beat could be seen as a positive for the economy and bullish for the market and a miss could be seen as the opposite. Also similar to the ADP number is to watch for revisions as 5 of the last 6 Non-farm payroll releases have been revised down in a pretty meaningful way.
Lastly on Friday at the same time as Non-farm payrolls is the Unemployment rate. Being an election year it can be expected that a high emphasis will be placed on employment numbers and the economy in general so this release could start to have some additional market-moving potential.
Best of luck this week and don’t forget to check out my daily options article.
On the date of publication, Gavin McMaster did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
