Weekly Economic Overview (September 30 - October 4, 2013).


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After a weekend of political theater, the House and Senate failed to reach a deal to avert a government shutdown. As part of the GOP plan, the Republicans proposed to delay Obamacare and repeal a tax on medical devices. The rejection from Democrats came in quickly, even before the House had a chance to vote on its proposal.

Given the past history of US government negotiations, an 11th hour deal is expected. However, if Congress can't reach a deal on a temporary spending budget bill by midnight October 1, 2013, it would jeopardize the paychecks of more than 800K Americans, as well as the country's economic recovery. The potential government shutdown isn't the only fiscal crisis looming for the US. The debt ceiling issue, which is far more concerning, could have catastrophic consequences on the economy, if the Congress fails to raise the debt ceiling by October 17, 2013.

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

Following is an economic overview for the week September 30 - October 4, 2013.

(All times EST)

Monday, September 30

China Manufacturing PMI (final reading):

China's manufacturing activity in September showed a small inclrease, supported mainly by rising overseas demand, adding to evidence that the Chinese economy continues to recover, though at a more modest pace than earlier data indicated (50.2 vs. preliminary reading of 51.2).

08:30 — Canada GDP (m/m):

GDP was reported 0.6% higher on a monthly basis, beating expectations for a 0.5% expansion and an improved release following the 0.5% GDP decline reported in June, which was the biggest monthly contraction since 2009. The economy expanded 1.4% since July 2012.

Tuesday, October 1

08:30 — UK Manufacturing PMI:

This report will present changes in UK's manufacturing sector in September 2013. In August 2013 the index rose to 57.2, indicating strong growth in the manufacturing sector.

05:00 — EU Unemployment Rate:

In August, unemployment remained unchanged at a high rate of 12.1%. If unemployment remains high, it could adversely affect the Euro.

10:00 — ISM Manufacturing PMI:

Monthly report will present changes in US manufacturing sector for September. In August, the index increased to 55.7%, indicating strong growth in the manufacturing sector.

Wednesday, October 2

04:30 — GB Construction PMI:

The upcoming report will present changes in Britain's construction sector for September. In August, construction PMI jumped sharply to 59.1 vs 57 in July, indicating strong growth in construction activity.

08:15 — ADP Non-Farm Employment Change:

ADP will publish its estimate for the next US non-farm payroll changes for September 2013 that will be released on Friday October 4, 2013.

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 September 27, 2013.

15:30 — Fed Chairman Bernanke's Speech:

Ben Bernanke will give brief welcoming remarks at the Federal Reserve Conference of State Bank Supervisors Community. Any statement pertaining to Fed's bond-buying is likely to stir financial markets.

Thursday, October 3

04:30 — EU Retail Sales:

Monthly report will present sales for August 2013. In July, volume of retail trade rose by 0.1%, lower than expectations.

08:30 — US Unemployment Claims:

Weekly report will refer to changes in initial jobless claims for the week ending on September 27, 2013. Last week jobless claims increased by 5K to reach 305K. This upcoming weekly update may affect the US dollar and consequently commodities and stocks markets.

10:00 — US ISM Non-Manufacturing PMI:

This report will present developments in non-manufacturing sector for September. In August, the index increased for the third consecutive week, to show a reading of 56.6%.

10:00 — US Factory Orders (m/m):

This report will refer the developments in US factory orders of manufactured durable goods during September. In August, orders fell by 2.4%.

Friday, October 4

08:30 — Non-Farm Employment Change:

In August, labor market showed limited signs of improvement — non-farm payroll employment increased by 169K, lower than expected. If employment increases by over 150K(in additional jobs) in September, commodities prices are likely to take a hit.


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: News Headlines , US Markets , Commodities , Economy
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