Economic data last week pointed to a soft US economy, but failed to quell speculation about possible actions by the Fed to trim its stimulus measures.
US stocks ended lower, with the S&P 500 posting consecutive weekly losses for the first time since November 2012, as investors were willing to take some money off the table after a seven-month run of gains. Commodity prices also retreated as traders sought safety in the midst of more bleak outlooks for the global economy.
For the week, DOW fell 1.2%, S&P 500 lost 1.1%, and NASDAQ dipped 0.1%.
Investors will be looking at a slew of top-drawer economic data this week from two standpoints: how the US economic recovery is coming along and whether conditions warrant an easing of stimulus measures by the US Federal Reserve.
Following are Sentiment charts for S&P 500 (NYSE:SPY), DOW Jones, and NASDAQ (NASDAQ:QQQ).
Following is an economic overview for the week June 3 - June 7, 2013.
(All times EST)
Monday, June 3
04:30 — Great Britain Manufacturing PMI:
This report will pertain to activity in Britain's manufacturing sector for April 2013.
09:00 — US Manufacturing PMI:
During April, the index declined to 50.7. A further decline in the index might adversely impact crude oil and natural gas markets.
Tuesday, June 4
08:30 — US Trade Balance:
Monthly report for April will reflect the developments in trade balance. In March, trade deficit declined to $38.8 billion.
08:30 — Canada Trade Balance:
In March, exports and imports increased by 5.1% and 1.7% respectively. As a result, trade balance shifted from a $1.2 billion deficit in February to a $24 million surplus in March. This upcoming report may affect the Canadian dollar which tends to be correlated with commodities prices.
Wednesday, June 5
08:15 — ADP Non-Farm Employment Change:
ADP will publish its estimate for the forthcoming US non-farm payroll change for May 2013. The official numbers will be released on June 7, 2013.
10:00 — ISM Non-Manufacturing PMI:
Monthly update will refer to changes in the non-manufacturing sector during May 2013. For the last update, this index slipped to 53.1 from 54.4, indicating slow growth in the non-manufacturing sector.
10:00 — Factory Orders m/m:
This report will present the developments in US factory orders of manufactured durable goods during May.
10:30 — Crude Oil Inventories:
The EIA (Energy Information Administration) will publish its weekly update on US crude oil inventories for the week ending on May 31. In the previous update, crude oil inventories increased by 9.7 million barrels to reach 1,812.2 million barrels.
Thursday, June 6
07:00 — BOE Rate Decision & Asset Purchase Plan:
Bank of England will announce its basic rate for June 2013. The Monetary Policy Committee will also state of any new changes to its asset purchase pogrom. As of May, BOE kept the rate unchanged at 0.5% and the asset purchase plan at £375 billion.
07:30 — ECB Rate Decision:
European Central Bank will decide its cash rate for June. ECB will need to address the ongoing economic slowdown, high unemployment and low inflation. Following the last meeting in which the ECB cut its rate to 0.50%, all eyes will be on Draghi's next move. There is high speculation that he might change ECB's monetary policy again. If ECB slashes its cash rate again, the Euro is likely to be adversely affected which will drag down commodities prices.
08:30 — US Unemployment Claims:
Weekly update will pertain to shifts in jobless claims for the week ending on May 31. In the previous report, jobless claims increased by 10K to reach 354K. This forthcoming weekly report may affect the US dollar and consequently commodities and stocks markets.
10:30 — EIA US Natural Gas Storage:
Weekly update will refer to latest changes in natural gas production, storage, consumption and rates as of May 31. In the previous weekly update, natural gas storage increased by 88 billion cubic feet to 2,141 billion cubic feet.
Friday, June 7
08:30 — Canada Unemployment Rate:
In April 2013, unemployment rate remained unchanged at 7.2%. This forthcoming report might affect the Canadian dollar and consequently commodities prices.
08:30 — US Non-Farm Employment Change:
In April , non-farm payroll employment increased by 165K. If employment increases by over 150K (in additional jobs) in the upcoming report, prices of precious metals are likely to slide.
For more insights, visit the Market IQ blog.
This commentary is for informational purposes only and does not constitute investment advice. The opinions offered herein are not recommendations to buy, sell or hold securities. Market IQ expressly disclaims all liability in respect to actions taken based on any or all of the information on this writing.