US Housing data, ADP Non-Farm Employment Change, GDP figures in the
US and Canada, US rate decision and Non-Farm Payrolls are the main
market movers this week. Here is an outlook on the major events coming
our way.
- US Pending Home Sales: Monday, 14:00. The number of contracts to purchase existing U.S. homes surged in May by 6.1%, the biggest climb since April 2010. The reading was far better than the 1.4% addition predicted by analysts, showing a strong rebound in the housing market. Stronger employment conditions as well as cheaper borrowing costs, enable the pick-up in the housing sector. Pending sales are expected to decline 0.2% this time.
- US CB Consumer Confidence: Tuesday, 14:00. U.S. consumer confidence edged up in June to 85.2 following a downwardly revised 82.2 in May, posting the highest reading since January 2008. Economists expected a smaller rise to 83.6. The expectations index increased to 85.2 in June from 83.5 in May, while the current situation index improved to 85.1 versus 80.3 in May. A further rise to 85.5 is expected now.
- US ADP Non-Farm Employment Change: Wednesday, 12:15. Private sector employment increased by 281,000 workers in June from 179,000 in May, according to the ADP report. Economists’ expected a modest rise of 207,000 jobs. The strong reading reflects continued strengthening in the labor market with a pick-up in Job creation. Private sector employment is expected to expand by 234,000.
- US GDP data: Wednesday, 12:30. Advance GDP, the earliest GDP measure released in April showed an annual growth pace of 0.1% in the first quarter, falling behind expectations for a 1.2% climb. Weather conditions and sluggish exports, housing and business investment were the main contributors for the shabby growth rate. The Preliminary GDP reading is predicted to reach 3.1%.
- FOMC Statement: Wednesday, 18:00. The Fed decisions released in June were in line with market expectations. Rates remained unchanged at a range of zero to 0.25% and taper continued on schedule. The Fed expressed concerned about the elevated unemployment rate, however noted an improvement in economic activity. The Committee voted to maintain accommodative stance of monetary policy to support growth. The FOMC downgraded its GDP forecast due to adverse weather in the first quarter.
- Canadian GDP: Thursday, 12:30. Canadian GDP Growth stalled in April, inching 0.1% as in the previous month, while expected to rise 0.2%. Wholesale and retail activity edged up mildly, while mining and construction output weakened. On a year-over-year bases gross domestic product expanded 2.1%, the same rate marked in the previous month. Canadian economy is expected to grow by 0.3%.
- US Unemployment claims: Thursday, 12:30. The US Labor market registered a decline of 19,000 claims for jobless benefits in the previous week; reaching 283,000.Analysts expected a rise to 307,000 in the number of claims. This was the lowest reading since February 2006. The four-week moving average declined by 7,250 to 302,000, from the previous week. This is the lowest average level since May 19, 2007. This week’s reading reinforces views that the US economy is matching forward. The number of unemployment claims is expected to reach 306,000.
- Haruhiko Kuroda speaks: Friday, 3:30. BOJ Governor Haruhiko Kuroda will speak in Tokyo. He may speak about the slowdown in inflation and his plans for the coming months.
- US Non-Farm Employment Change and US Unemployment Rate: Friday, 12:30. The US labor market showed a remarkable job Addition of 288,000 in June, the strongest reading since January 2012, following a gain of 217,000 in May. Analysts expected a weaker increase of 214,000. This was another sign that the US job market is strengthening parallel to the economic recovery. The unemployment rate fell to 6.1% from 6.3% registered in May, the lowest level since Sep. 2008. Analysts expected rates to remain unchanged at 6.3%. The US labor market is expected to increase by 230,000 jobs, while the unemployment rate is forecasted to remain unchanged at 6.1%.
- US ISM Manufacturing PMI: Friday, 14:00. In June, the ISM manufacturing index declined mildly to 55.3, from 55.4% recorded in May. The figure was a little below market forecast of 55.6. However, the index still indicates expansion in the manufacturing sector. Declines in production and in supplier deliveries were the main reason for the lukewarm rise. US manufacturing sector is expected to expand to 56.1.
