Proactive Investors - The macro week ahead will be dominated by updates on the US jobs market while in the UK, it will be the High Street and the housing market in the spotlight.
Jobs, jobs and more jobs data in the US
As ever, the first week of the month will be dominated by US non-farm payrolls figures as economists, politicians and central bankers gauge the state of the labour market across the pond.
Ahead of those, the Job Openings and Labor Turnover Survey (or JOLTS) will be released on Tuesday, followed by the ADP payrolls survey on Wednesday and the weekly initial unemployment claims and the Challenger job losses surveys on Thursday.
Russ Mould at AJ Bell thinks the JOLTS survey could be particularly telling.
“Job vacancies have been in decline for some time and the quits rate has cooled as well, perhaps as a sign that workers are little less confident about the outlook and a little more willing to stay put and stick with their current employer,” he said.
James Knightley at ING Economics thinks recent data shows firms are "reluctant to fire workers, but they are less inclined to hire new workers. i.e. more evidence of a cooling, but not collapsing, labour market."
"This was also the message within [Wednesday’s] Federal Reserve Beige Book, which reported that 'most districts reported flat to modest increases in overall employment'," he noted.
In October, the US added 150,000 jobs, which Mould points out was the lowest figure since January 2021 and below the 12-month average run rate of 243,000.
The FXStreet consensus is for the US economy to add 175,000 jobs in November with ING going for 180,000 adds.
ING expects the unemployment rate to stay at 3.9%, but soon expects it to break above 4%.
Subdued wage growth should reaffirm the market’s view that the inflation pressures from the jobs market are weakening fast, aided by improving productivity growth, it thinks.
The data comes ahead of December’s FOMC meeting at which interest rates are widely expected to be left unchanged.
Aside from jobs data, US investors will cast a careful eye over factory orders data and service sector PMIs.
UK retail sector in the spotlight
Back to the UK, and alongside the services sector PMI, will come updates on the health of the High Street and the housing market.
The British Retail Consortium (BRC) sales monitor, in conjunction with KPMG, will give an insight to how retailers are feeling heading into the key festive period.
Data from Barclays (LON:BARC) showed a modest drop in shopper numbers and transactions in the UK on Black Friday versus last year.
"This dip in sales volumes year-on-year is perhaps expected given the impact of the cost-of-living on Brits' discretionary spending and the trend towards launching discounts earlier in November," said Marc Pettican, head of Barclaycard Payments.
Figures from the Office for National Statistics showed UK retail sales in October fell to their lowest level since a Covid-19 lockdown-hit February 2021.
According to the ONS, retail sales volumes declined 2.7% year on year in October, quickening from a 1.3% decline in September.
Rising prices and interest rates plus concerns about the economy have provided a potent adverse cocktail for retailers although some are performing well as strong trading from Marks & Spencer and Next show.
Will Halifax follow Nationwide with house price rise?
Halifax will follow Nationwide with its take on house prices.
Nationwide reported prices rose for a third month in a row as mortgage rates fell offering hope that the market could be turning.
But Gabriella Dickens at Pantheon Macroeconomics warned not to “get too excited about the prospect of a sustained recovery just yet”.
She thinks the rise in Nationwide’s index over the last couple of months will reverse in the very near term and a material recovery in house prices still looks a few months away yet.
The latest construction PMI will provide an indication as to whether this recovery is taking hold or is a false dawn.