Financial Market Preview for February 2-6

Last week continued the high volatility following the recent FOMC policy meeting and US’s GDP fourth quarter release. This week is also entails important financial reports from the US most notably the non-farm payroll, manufacturing PMI, PCE, and factory orders and trade balance – just to name a few. Canada will also release its monthly update on employment and trade balance.   In Europe, BOE will announce of any changes to its rate. Also, German factory orders, GB’s manufacturing PMI and Germany retail sales, and Spain’s unemployment update will also be published. In China, manufacturing PMI will be released. Finally, in the country down under the RBA rate decision, trade balance report and RBA’s monetary policy statement are the main events for the week.  So let’s review the agenda for the week of February 2nd to 6th:

(All times GMT):

Monday, February 2nd

02:45 – China Manufacturing PMI (HSBC’s final update): This is HSBC’s recent update for its January’s PMI index. Last month’s Manufacturing PMI edged down again to 49.6 – i.e. China’s manufacturing sectors are contacting. Current estimates are at 49.8 — so China’s manufacturing conditions are still slowing down only a slower pace;

08:00 – Spanish Unemployment change: In the previous report for December 2014 the number of unemployed fell by 64.4K;

09:30 – GB Manufacturing PMI: During December, Great Britain’s manufacturing index slipped to 52.5 – market expectations are that in January the PMI inched up to 52.9;

13:30 – U.S. core PCE: The personal consumption expenditures index is another index the FOMC follows to assess of inflation. In the previous report, the PCE index rose by 0.6% and the core PCE (excluding food and energy) remained flat. The expectations are for a 0.1% fall in PCE and no change in core PCE for the upcoming report;

15:00 – US Manufacturing PMI: This report will refer to January 2015. Back in December, the index slipped to 55.5; this means the manufacturing is expanding at a slower pace; this index may impact stock markets, USD, and crude oil and natural gas markets; analysts expect this index to decline to 54.9;

Tuesday, February 3rd

01:30 – Australian Trade Balance: The next report will pertain to December. In the previous update, for November, the seasonally adjusted balance of goods and services reached a $0.93 billion deficit; the report will also show the shifts in the exports of non-monetary gold (see here the last update);

05:30 – Reserve Bank of Australia – Cash Rate Statement: The RBA left its cash rate unchanged since September of 2013. But BOC’s recent rate cut and the ongoing weakness in China could start to push the needle for RBA to cut down its cash rate, which is still at 2.5%. Nonetheless, the current expectations are for no change in policy this time;

15:00 – US Factory Orders: This report shows the changes in U.S. factory orders of manufactured durable goods in January; in the latest report regarding December factory orders dropped again by 0.7%; current projections are for a 1.8% decline for last month;

Wednesday, February 4th

09:30 – GB Services PMI: In the previous report, this index declined to 55.8; this index may impact the direction of the British Pound;

13:15 – ADP estimate of U.S. non-farm payroll: ADP will release its estimate for the next U.S non-farm payroll changes for January 2015 that will be published on Friday;

15:00 – U.S. ISM Non-Manufacturing PMI: This monthly report will refer to January 2015. In the last report, this index slipped to 56.2 — the non-manufacturing sector is growing at a slower rate compared to the last month; current estimates are for the PMI to bounce back to 56.6;

15:30 – US Crude Oil Stockpiles Weekly Report: The Energy Information Administration will release its weekly update on the U.S oil and petroleum stockpiles for the week ending on January 30th;

Thursday, February 5th

01:30 – Australia’s Retail Sales: In the last report, the volume of retail trade inched up by 0.1%;

06:00 – German Factory Orders: In the last report, factory orders dropped by 2.4% during December;

12:00 – BOE Rate Decision & Asset Purchase Plan: Bank of England will release its basic rate for February 2015; the MPC will also announce of any changes to its asset purchase pogrom; the current expectations are for no changes to the rate at this point in time; BOE’s interest rate remained at 0.5% and the asset purchase plan at £375 billion, as of last month;

13:30 – US Jobless Claims Weekly Report:  This weekly report will refer to the changes in the initial jobless claims for the week ending on January 30th; in the previous report, the jobless claims dropped again to 265K;

13:30 – Canadian Trade Balance: In the last report, the trade balance moved from $0.1 billion surplus in October to $0.6 billion deficit in November;

13:30 –American Trade Balance: This monthly report for December will present the changes in imports and exports of goods and services to and from the U.S, such as commodities such as oil and gas; according to the previous American trade balance update regarding November the goods and services deficit contracted to $39 billion; current projections are for the deficit to decline to $38 billion;

15:30 – EIA US Natural Gas Storage: The EIA weekly report of the U.S. natural gas market will refer to the latest shifts in natural gas production, storage, consumption and prices as of January 30th;

Friday, February 6th

01:30 – Reserve Bank of Australia – Monetary Policy Statement: The RBA will release its quarterly report pertaining to the Bank’s monetary policy;

13:30 – U.S. Non-Farm Payroll Report: In the last employment report referring to December 2014, the number of non-farm payroll employment rose by 252K – inline with market expectations; the U.S unemployment rate inched down again to 5.6%. If the upcoming report shows another strong gain (current projections are at 231K), this could further strengthen the USD and bring back down the prices of precious metals;

13:30 – Canada’s Employment Report: In the last employment update for December 2014, unemployment remained flat at 6.6%; the employment slipped by 4.3K;

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