Weekly Economic Overview (July 01 - July 05, 2013)


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While last week's economic reports and a slew of speeches eased tension in equity and bond markets, Fed’s next potential move still has the market in jitters.

For the week, DOW gained 0.7%, S&P 500 added 0.9%, and NASDAQ rose 1.4%.

While major indices ended positive, the sharp drop in the last 15 minutes of trading on Friday did erase a good part of the week's gains.

This week investors will be closely eyeing unemployment data to get a handle on the likelihood and timing of a Federal Reserve easing of its bond-buying program.

Following are Sentiment charts for S&P 500 (NYSE:SPY), DOW Jones, and NASDAQ (NASDAQ:QQQ).

Following is an economic overview for the week July 01 - July 05, 2013.

(All times EST)

Monday, July 01

10:00 — ISM Manufacturing PMI (June 2013)::

During May, the index dropped to 49%, signaling contraction in US manufacturing sector. A further decline in the index may adversely affect crude oil and natural gas markets.

Tuesday, July 02

10:00 — US Factory Orders (June 2013):

This report will offer insights regarding growth in the US economy.

Wednesday, July 03

08:30 — ADP Non-Farm Employment Change:

ADP will release its estimates for US non-farm employment change for June 2013.

08:30 — US Unemployment Claims:

Given the gyrating market, one of the more important reports this week. Report will refer to developments in the initial jobless claims for the week ending June 28, 2013. In the last report jobless claims fell by 9k to reach 346k. This upcoming weekly update may affect the US dollar and consequently commodities and stocks markets.

08:30 — US Trade Balance:

Monthly update will present changes in imports and exports of goods and services to and from the US for May 2013. In April trade deficit increased to $40.3 billion. A further increase in deficit may adversely affect the US dollar against major currency pairs.


08:30 — Canada Trade Balance:

This report may affect the Canadian dollar, which tends to be linked with commodities prices. In April 2013, exports declined by 0.2% and imports increased by 1.2%; as a result, the trade balance fell from a $3 billion deficit in March to $567 million in April.


10:00 — ISM Non-Manufacturing PMI:

Monthly update will pertain to changes in the non-manufacturing sector during June 2013. In May, this index increased to 53.7% from 53.1% in April — indicating that the non-manufacturing sector was expanding, and expanded at a faster rate in May vs. April.


10:30 — Crude Oil Inventories:

EIA (Energy Information Administration) will publish its weekly report on US crude oil inventories for the week ending on June 28 2013.


Thursday, July 04

08:30 — BOE Rate Decision & Asset Purchase Plan:

Bank of England will publish its basic rate for July 2013. The Monetary Policy Committee will also announce of any new developments to its asset purchase pogrom. As of June, BOE left the rate unchanged at 0.5% and the asset purchase plan at £375 billion.

07:45 — ECB Rate Decision:

ECB will announce its cash rate for July. Following the last meeting in which the ECB left its rate at 0.50%, all eyes will be on Draghi's next move. If ECB cuts its cash rate again, the Euro is likely to be adversely affected, which will also drag down commodities prices.


Friday, July 05

08:30 — US Non-Farm Employment Change:

In May, non-farm payroll employment increased by 175K. If in the upcoming report employment increases by over 150K (in additional jobs), gold and silver prices are likely to slide.

Commentary by:
Adil Yousuf

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.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Economy , Investing Ideas , Stocks
More Headlines for: QQQ , SPY

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