Financial Market Preview for September 28- October 2

The U.S. dollar resumed its upward trend and strengthened against leading currencies including the Euro and Yen. The recent hawkish remarks of FOMC Chair Yellen along with the modest upward revision of the US GDP provided some backwind for greenback. Despite the recovery of the USD, commodities including oil and gold kept climbing in the past week. The high volatility in commodities market could suggest this recent rally of commodities may not last long. This week the main event will be the release of the NFP on Friday. Other report and events include: FOMC Yellen, Dudley and Fischer speak, EU flash CPI, GB GDP for Q2, U.S. factory orders, U.S. consumer confidence, Canada’s GDP, U.S. PCE, GB, China and U.S. manufacturing PMI, and Australian retail sales. So let’s review the main items for the week of September 28th to October 2nd.  

(All times GMT):

Monday, September 28th

13:30 – FOMC members Dudley Speaks: He will discuss interest-rate increases and inflation expectations in an interview conducted by WSJ’s Jon Hilsenrath;

13:30 – U.S. core PCE: The personal consumption expenditures index is an important indicator the FOMC follows to analyze the shifts in U.S. inflation. In the recent report, the PCE index increase by 0.3% and the core PCE (excluding food and energy) edged up again by 0.1%. The expectations are for the core PCE to edge up again by 0.1% and PCE by 0.3%;

15:00 – U.S. Pending Home Sales: This report shows the changes in pending home sales in the U.S during August; in the previous update for July, pending home sales index rose by 0.5% (month-over-month). Currently, the market expects home sales to increase by 0.4% in the last month;

Tuesday, September 29th

15:00 – U.S. Consumer Confidence: According to the recent report for August, the consumer confidence index rose to 101.5. The current estimates are that the index fell back 96.2;

20:40 – BOE Gov Carney Speaks: He is expected to talk at the Lloyds of London;

Wednesday, September 30th

07:00 – Germany’s Retail Sales: In the last report for August 2015, retail sales increased by 1.4%;

09:30 – Final Estimate of Great Britain GDP Q2 2015: This report will present the final estimate of the quarterly growth rate of the British economy for Q2 2015; in the first estimate, the GDP grew by 0.7%; currently, the market estimates the GDP report will show no change in the growth rate;

10:00 – EU CPI Flash Estimate: This index estimates the yearly consumer price index of the Euro Area. According to the recent estimate for August, the annual CPI was unchanged at 0.2%. The core CPI remained at 1%. The current estimates are that the inflation fall to 0% last month, and the core CPI to inch down to 0.9%;

10:00 – EU Unemployment: Last month, the rate of unemployment slipped to 10.9%;

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 September 2015 that will be published on Friday;

13:30 – Canada’s GDP by Industry: This monthly report shows the changes in major industrial sectors for July 2015. In the previous update regarding June 2015, the real gross domestic product rose by 0.5%; the current expectations are for the GDP to rise by 0.2%;

15:30 – U.S Crude Oil Stockpiles Weekly update: The EIA (Energy Information Administration) will release its weekly report on the U.S oil and petroleum stockpiles for the week ending on September 25th;

20:00 – FOMC Chair Yellen Speaks: She is also expected to deliver opening remarks at the Federal Reserve’s annual community banking conference, in St. Louis;

Thursday, October 1st

02:00 – China Manufacturing PMI: The Manufacturing PMI declined again to 49.7 – i.e. China’s manufacturing sectors are contracting. Current estimates are for no change;

02:45 – China’s Caixin Final Manufacturing PMI: In the previous estimate, the PMI fell again to 47.3; current estimates are for the PMI to decline again to 47.2 – the manufacturing conditions are still contracting at a faster rate; it’s less important than the flash estimate but could still keep the markets concern;

09:30 – GB Manufacturing PMI: back in August, Great Britain’s manufacturing index fell to 51.5 – market expectations are that in September the PMI edged down to 51.3;

13:30 – U.S. Jobless Claims Weekly Report:  This weekly report will refer to the shifts in the initial jobless claims for the week ending on September 25th; in the recent report, jobless claims rose to 267K; the expectations are  for this number to rise to 273K;

15:00 – U.S. ISM Manufacturing PMI: This report will refer to September 2015. In the recent update for August, this index fell to 51.1 — the manufacturing sector is expanding at a slower rate compared to the last month; current estimates are for the PMI to fall again to 50.8;

15:30 – EIA U.S. Natural Gas Storage: The EIA weekly report of the U.S. natural gas market will refer to the recent changes in natural gas production, storage, consumption and rates as of September 25th;

Friday, October 2nd

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

13:30 – U.S. Non-Farm Payroll Update: In the August employment report, the number of non-farm payroll employment rose by only 173K – below market expectations; the U.S. unemployment rate slipped to 5.1%. If the upcoming report presents a stronger than expected gain in employment (current projections are at 202K), this could keep driving up the USD and bring down precious metals;

15:00 – U.S. Factory Orders: This report shows the changes in U.S. factory orders of manufactured durable goods in September; in the July report, factory orders bounced back by 0.4%; current projections are for a 0.9% drop in September;

18:30 – FOMC Member Fischer Speaks: He is due to speak at the Federal Reserve’s Macro-prudential Monetary Policy conference, in Boston;

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