Employment data was the main highlight last week. Non-farm payrolls showed robust numbers for November: The US economy added 203K new jobs vs. expectations of 180K, while the unemployment rate fell to 7% vs. expectations of 7.2%.
US market indexes rallied sharply following the report even though the 10-year bond yield surged to 2.85% showing the difference between yields on two-and 10-year Treasuries widened to the most since 2011 as improvement in employment reinforced expectations the Federal Reserve is close to taper its bond purchases which have been used to stimulate growth in the economy.
Data released December 8 showed Chinese exports jumped 12.7% in November from the year-earlier period, while imports rose 5.3%. The week ahead could see US markets scale new highs on the back of strong global cues and optimism going into the holiday season. Additionally, wide expectations of no December taper could act as a catalyst as well.
Following are Sentiment charts for S&P 500 (NYSE:SPY), DOW Jones, and NASDAQ (NASDAQ:QQQ).
Following is an economic overview for the week December 9 - December 13, 2013.
(All times EST)
Monday, December 9
13:05 — FOMC Member Bullard's Speech:
FOMC member and Federal Reserve Bank of St. Louis President, James Bullard, is expected to deliver a speech regarding economic outlook and monetary policy. His speech would be of particular interest for investors as he may drop subtle clues regarding future monetary policy which could provide an indication as to what the Federal Reserve is expected to do in its upcoming December FOMC meeting.
Tuesday, December 10
00:30 — China Industrial Production:
In November, China industrial production increased to an annual rate of 10.3%, surpassing analyst expectations of 10.2%. Since production is the dominant driver of the economy, a further increase in growth rate would suggest that the Chinese growth is accelerating.
Wednesday, December 11
10:30 — Crude Oil Inventories:
EIA (Energy Information Administration) will publish its weekly report on US oil and petroleum inventories for the week ending on December 6, 2013.
14:00 — US Federal Budget Balance:
In October the deficit rose by $91 billion. If the November report indicates a further increase in deficit, it could influence the decision of US policymakers regarding future budget cuts.
Thursday, December 12
08:30 — US Core Retail Sales:
In October, retail sales increased by 0.2% (month-over-month) while core retail sales increased by 0.4%. For the upcoming November report expectations call in for a 0.2% increase in retail sales.
08:30 — US Unemployment Claims
Weekly update will refer to shifts in the initial jobless claims for the week ending December 06, 2013. In the previous report, jobless claims declined by 23K to reach 298K. The upcoming weekly report may affect the US dollar and consequently commodities prices and equities markets.
Friday, December 13
08:30 — US Producer Price Index:
In October, the index for finished goods declined by 0.2% when compared with September's level and the core PPI increased by 0.2%. For the upcoming November report, economists expect the index to remain unchanged.