Financial Market Forecast for December 1-5

Following the thanksgiving break, the markets will start working normal again. This week, the NF payroll report will take center stage in the U.S. Other financial reports from the U.S. include manufacturing PMI, factory orders and trade balance monthly updates. In Europe, ECB and MPC rate decisions will take place. GB’s manufacturing PMI and Germany factory orders will also be released. In China, manufacturing PMI will be published. In Canada, BOC will also make a rate decision and employment and trade balance reports will released. Finally, in Australia, GDP for Q3, RBA’s rate decision, and trade balance are the top headlines for the week. So let’s review in detail the agenda for the week of December 1st to 5th:

(All times GMT):

Monday, December 1st

02:00 – China Manufacturing PMI: As of September, the Manufacturing PMI inched down to 50.8 – i.e. China’s manufacturing sector is expanding growing at a slower pace. Analysts currently estimate that China’s PMI slipped again in the past month;

02:45 – China Manufacturing PMI (HSBC’s final estimate): This is HSBC’s last estimate for its November’s PMI index. Last month’s Manufacturing PMI edged up to 50.4 – i.e. China’s manufacturing sectors are growing at a faster pace. If the updated PMI index falls – current estimates are at 50, this may imply China’s manufacturing conditions are slowing down again;

09:30 – GB Manufacturing PMI: During August, Great Britain’s manufacturing index bounced back to 53.2 – market expectations are that in September the PMI inched down to 53.2;

15:00 – U.S Manufacturing PMI: This report will refer to November 2014. Back in October, the index rose to 59; this means the manufacturing is expanding at a faster rate; this index may impact stock markets, USD, and crude oil and natural gas markets; analysts expect this index to fall to 57.9;

Tuesday, December 2nd

05:30 – Reserve Bank of Australia – Cash Rate Statement: The RBA left its cash rate flat since September of 2013. The current rate is set at 2.5%. China’s recent rate cut and Japan’s ongoing expanding monetary policy are likely to influence RBA to consider changing its monetary policy as these countries are working towards devaluing their currencies. Nonetheless, the current expectations are for no change in policy;

09:30 – GB Construction PMI: In the previous monthly update, this index dropped to 61.4;

13:30 –FOMC Chair Yellen Speaks: Janet Yellen is expected to deliver opening remarks at the 2014 College Fed Challenge National Finals, in Washington DC;

02:30 – Australian GDP Third Quarter of 2014: This quarterly report will refer to the Australia’s GDP growth rate for the third quarter of 2014. In the second quarter of 2014, the GDP grew by 0.5% (seasonally adjusted). Currently, the estimates are for a 0.7% gain in the third quarter. Australia is among the leading countries in exporting commodities such as oil, LNG, and metal ores to big economies such as China and Japan; if the GDP growth rate doesn’t pick up, it could bring down the Australia dollar (see here last update);

Wednesday, December 3rd

09:30 – GB Services PMI: In the last report, this index dropped again to 56.2; 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 November 2014 that will be published on Friday;

15:00 – Bank of Canada’s Overnight Rate and Press Conference: The Bank of Canada will announce its overnight rate for next month – the rate is set at 1%. The BOC isn’t likely to change its cash rate;

15:00 – U.S. ISM Non-Manufacturing PMI: This monthly report will refer to November 2014. In the previous report, this index declined to 57.1% — the non-manufacturing sector is growing at a slower rate compared to the last month; current estimates are for the PMI to rise back to 57.5;

15:30 – U.S 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 November 28th;

22:30 –BOC Governor Poloz Speaks: The Governor is due to speak the Canada Summit, in Toronto;

Thursday, December 4th

01:30 – Australia’s Retail Sales: In the previous report, the volume of retail trade rose by 1.2%;

01:30 – Australian Trade Balance: The forthcoming report will pertain to October. In the last update, for September, the seasonally adjusted balance of goods and services reached a $2.26 billion deficit; the report will also show the changes in the exports of gold; if gold exports fall, it might suggest a drop in demand for non-monetary gold (see here the previous update);

12:00 – BOE Rate Decision & Asset Purchase Plan: Bank of England will announce its basic rate for December 2014; 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;

12:45 – ECB Rate Decision: ECB will announce of any shifts to its monetary policy for December. This time, Mario Draghi may offer some additional information regarding ECB’s future plans to implement its ABS program;

13:30 – U.S. Jobless Claims Weekly Report:  This weekly report will refer to the changes in the initial jobless claims for the week ending on November 28th; in the recent report the jobless claims rose again to 313K;

15:00 – Canada Ivy PMI: This index is based on surveyed purchasing managers; last time, the PMI dropped to 51.2, which shows growth at a slower pace;

15:30 – EIA U.S. 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 November 28th;

Friday, December 5th

06:00 – German Factory Orders: In the last update, factory orders rose by 0.8% during October;

13:30 – Canadian Trade Balance: In the recent report, the trade balance moved from $0.6 billion deficit in August to $0.7 billion surplus in September; if the trade balance shows a sharp shift, it could move the Canadian dollar;

13:30 –American Trade Balance: This monthly report for September 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 last American trade balance update regarding August the goods and services deficit expanded to $43 billion;

13:30 – U.S. Non-Farm Payroll Report: In the last employment report referring to October 2014, the number of non-farm payroll employment grew by 214K – slightly lower than anticipated; the U.S unemployment rate edged down again to 5.8%. If the upcoming report shows another strong gain of well above 200K (current estimates are at 225K), this could further strengthen the USD and drag down precious metals;

13:30 – Canada’s Employment Report: In the recent employment update for October 2014, unemployment declined to 6.5%; the employment rose by 43.1K;

15:00 – U.S Factory Orders: This report presents the developments in U.S. factory orders of manufactured durable goods in November; in the latest report regarding October factory orders slipped by 0.6%; current projections are for a 0.2% fall in the previous month;

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