U.S. Markets closed

Trading Radar: Busy Holiday-Shortened Week Ahead With Nonfarm Payrolls and Central Banks

Michael Sedacca

US markets will be closed on Monday for the Labor Day holiday. European markets and Asian markets will be open, however. UN chemical weapons inspectors will pull out of Syria early Saturday morning, which opens the door for a potential military strike from France or the United States. US presidential officials will most likely have to request authorization from Congress before a military strike is conducted, however.

Tuesday will kick off a very busy week in economic data releases. The national ISM manufacturing survey for August will be released at 10 a.m. ET alongside July construction spending. The construction spending release has more statistical significance to 3Q GDP, whereas the ISM survey is a leading indicator. Thus far, August manufacturing surveys have shown a net improvement from the prior month with strong growth in new orders. However, employment has continued to lag growth in activity.

Wednesday we will receive US July trade numbers and August vehicle sales figures. In June, America's trade deficit narrowed to -$34.2 billion, the smallest deficit since 2010, on rising exports and a sizable decline in oil imports. The trade deficit is expected to widen to -$38.6 billion from -$34.2 billion in June. Vehicle sales are expected to rise to an annualized rate of 15.80 million from 15.60 million in July. The recent rise in interest rates has thus far only had a minimal effect on auto sales.

Thursday will bring the two major leading indicators for Friday's nonfarm payrolls report. The ADP private payroll report is due out at 8:15 a.m. ET on Thursday morning. Economists expect a 180K gain in August, down from 200K in the month prior. The other important release is the ISM non-manufacturing (services) survey. This survey is estimated to drop to 55.0 in August from 56.0 in July. Lastly, July's factory orders data will be released Thursday. Factory orders and construction spending reports will have the largest significance on 3Q GDP.

The biggest market-moving event for the week is Friday's August nonfarm payrolls report. Even though the initial estimate will be revised for the next 12 months, this number typically generates the most market volatility. Payrolls are estimated to rise by 180K in August, up from 162K the month prior. This will not be enough to move the needle with the unemployment rate, which is forecast to remain unchanged at 7.4%.

Earnings reports for the week ahead include Dollar General (DG), Ciena (CIEN), Verifone Systems (PAY), and Smithfield Foods (SFD).

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Over the weekend, Vodafone (VOD) may finalize its planned sale of its 45% stake in Verizon Wireless, a division of Verizon (VZ). The sale may fetch up to $130 billion, the second largest deal in history.

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Every major global central bank will make their monetary policy decision in the coming week. Central banks from Japan, Australia, England, Canada, and the eurozone will all release new decisions on interest rates. The Australian central bank has made comments that it may ease interest rates in the future due to declining exports. Japan may look to ratchet up its expansion of the monetary base as inflation growth has fallen below expectations. Lastly, the BoE and ECB should release forward guidance on interest rates, similar to the US Federal Reserve.

Also during the week are GDP releases from the eurozone, Canada, Australia, and the UK. Manufacturing indexes are due out from China, the UK, the eurozone, and Switzerland.

Monday, September 2

US Economics (Time Zone: EDT)

US markets closed for Labor Day holidays

Global Economics (Time Zone: GMT)

01:30 AUD Building Approvals
01:45 CNY HSBC Manufacturing PMI
07:55 EUR German Manufacturing PMI (final estimate)
08:00 GBP Manufacturing PMI


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No major earnings

Tuesday, September 3

US Economics (Time Zone: EDT)

08:58 Markit US PMI Final – consensus 54.0, preliminary 53.9
10:00 Construction Spending – consensus 0.3%, prior -0.6%
10:00 ISM Manufacturing – consensus 54.0, prior 55.4
10:00 ISM Prices Paid – consensus 51.2, prior 49.0
10:00 IBD/TIPP Economic Optimism – consensus 46.0, prior 45.1
11:30 Treasury selling $30b 3-month, $25b 6-month bills

Global Economics (Time Zone: GMT)

01:00 CNY Non-manufacturing PMI
01:30 AUD Retail Sales
04:30 AUD RBA Rate Decision
05:45 CHF GDP
08:30 GBP Construction PMI
09:00 EUR Eurozone PPI


H&R Block (HRB)

Wednesday, September 4

US Economics (Time Zone: EDT)

7:00 MBA Mortgage Applications
7:30 Challenger Job Cuts YoY
08:30 Trade Balance – consensus -$38.8b, prior -$34.2b
2:00 Fed's Beige Book
5:00 Total Vehicle Sales – consensus 15.8M, prior 15.6M
5:00 Domestic Vehicle Sales – consensus 12.25M, prior 12.09M
11:30 Treasury selling 4-week bills


12:30pm Williams speaking on monetary policy in Oregon
8:00pm Kocherlakota speaks at town hall forum in Wisconsin

Global Economics (Time Zone: GMT)

01:30 AUD GDP
07:55 EUR Eurozone Services PMI
08:30 GBP Services PMI
09:00 EUR Eurozone 2Q GDP (preliminary estimate)
09:00 EUR Eurozone Retail Sales
14:00 CAD Bank of Canada Rate Decision


Navistar (NAV)
Ciena (CIEN)
Dollar General (DG)

Thursday, September 5

US Economics (Time Zone: EDT)

08:15 ADP Employment Change – consensus 180K, prior 200K
08:30 Initial Jobless Claims - consensus 330k, prior 331k
08:30 Continuing Claims – consensus 2990K, prior 2989K
08:30 Nonfarm Productivity – consensus 1.5%, prior 0.9%
08:30 Unit Labor Costs – consensus 0.9%, prior 1.4%
10:00 Factory Orders – consensus -3.5%, prior 1.5%
10:00 ISM Non-manufacturing Composite – consensus 55.0, prior 56.0


9:00am Kocherlakota speaking in Wisconsin

Global Economics (Time Zone: GMT)

JPY BoJ Rate Decision
01:30 AUD Trade Balanec
10:00 EUR German Factory Orders
11:00 GBP BoE Rate Decision
11:45 EUR ECB Rate Decision


Conn's (CONN)
Quiksilver (ZQK)
Smith & Wesson (SWHC)
Finisar (FNSR)
Verifone (PAY)

Friday, September 6

US Economics (Time Zone: EDT)

08:30 Nonfarm Payrolls – consensus 180K, prior 162K
08:30 Private Payrolls – consensus 180K, prior 161K
08:30 Manufacturing Payrolls – consensus 5K, prior 6K
08:30 Unemployment Rate – consensus 7.4%, prior 7.4%
08:30 Average Weekly Hours – consensus 34.5, prior 34.4

8:00am Evans speaks in South Carolina
1:30pm George speaking on economy in Nebraska

Global Economics (Time Zone: GMT)

05:00 JPY Leading Index
07:15 CHF CPI
07:15 CHF Industrial Production
08:30 GBP Industrial and Manufacturing Production
08:30 GBP Trade Balance
10:00 EUR German Industrial Production
12:30 CAD Employment Change


Smithfield Foods (SFD)

Twitter: @MichaelSedacca

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