It’s that time again already – did the US see a nonfarm rebound in January, or were even more jobs lost?
US
There’s a lot going on this week, and that’s without even considering the ongoing GameStop (NYSE:GME) saga, and how much that unsettling volatility will keep investors away from the markets.
One of the big ticket items is the covid-19 relief plan. Attempts to get it passed begin in earnest this week, and the markets may be able to get a clearer idea of which path the Democrats will take: either convincing 10 Republican senators to back the package, or the route of budget reconciliation, which would require a simple majority.
Progress on that front will come alongside anxieties about the state of the US economy, with the week providing plenty of data for investors to chew through.
The final Markit and ISM manufacturing PMIs are released on Monday, followed by the services equivalent, alongside the ADP) nonfarm employment change reading, on Wednesday. Thursday will hopefully see the jobless claims number continue to fall, while factory orders could remain stable around 1%.
Friday, of course, is the main event: the nonfarm jobs report for January. December’s headline figure was far uglier than anyone had forecast; it showed 140,000 jobs had been lost, rather than the estimated (modest) gain of 60,000. At present forecasts are suggesting the number will bounce back, with an addition of 85,000 jobs; however, nonfarm estimates are notoriously hard to get right.
As for the report’s other figures, a continued reduction in the unemployment rate could help alleviate a worse than expected nonfarm number, while average hourly earnings are chasing their 3rd consecutive beat.
The corporate sector still has a few giants left to update, especially on Tuesday, when Amazon (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOGL) both report.
The retail monolith is, like Apple (NASDAQ:AAPL) the week prior, expected to post some blockbuster numbers for the fourth quarter. Analysts are looking for a 37.6% surge in revenue to $120.4 billion – more than the yearly GDP of Morocco – alongside an 8.2% jump in earnings to a solid $7 per share.
The Google-parent, meanwhile, is heading for a 2.1% rise in EPS to $15.68 year-on-year, off of a 14.8% jump in revenue to $52.9 billion.
UK
Erasing all the growth managed in the first trading week of 2021, the FTSE is going into February back at square one.
Continued anxiety over the UK’s endless lockdown, and an argument with the EU about the Oxford/AstraZeneca PLC (LON:AZN) vaccine, has undermined confidence in the index, and left it on a rather nasty losing streak.
And it’s likely those problems will remain an issue for the FTSE, and the pound, throughout the early stages of February.
To complicate matters, there is a Bank of England meeting on Thursday, one that could provide further details on its stance on negative rates, after it conducted a consultation with banks back in November. As a BoE chaser, Andrew Bailey then appears at an online event on Friday, one that could be used elucidate whatever decisions were (and weren’t) made on Thursday.
A busy economic calendar has the final manufacturing PMI joined by mortgage approvals and net lending to individuals on Monday. That’s followed by the Nationwide HPI on Tuesday, the final services and construction PMIs on Wednesday and Thursday respectively, and the Halifax HPI on Friday.
On the corporate side of things, there are some biggies, including BP’s final results on Tuesday, updates from GlaxoSmithKline and Vodafone (LON:VOD) on Wednesday, and Shell (LON:RDSa), Unilever (LON:ULVR), Barratt Developments (LON:BDEV) and BT Group (LON:BT) on Thursday.
Eurozone
Keeping eye on the vaccine rollout (and shortage) across the region, the Eurozone has a fairly busy economic calendar to get through.
The final manufacturing PMIs are on Monday, followed on Tuesday by the Italian and Eurozone-wide flash GDP readings on Tuesday. There are then the final services PMIs and Eurozone inflation number on Wednesday, retail sales on Thursday, and German factory orders, French trade balance and Italian retail sales on Friday.
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