A Fed meeting, the April jobs data for the US, some more major profits led by Amazon and Apple, two major bank results in Australia, worldwide surveys of economic activity for last month — especially for China — and the continuing tensions in the Middle East and Ukraine.
The Fed’s two day meeting and media conference by chair, Jay Powell, will dominate think — both before and after and the jobs data will provide another big end-note for the week’s news and trading.
Around 250,000 new jobs (303,000 in March) and an unchanged jobs rate of 3.8% means steady as she goes and no room for the Fed to provide any guidance about the timing of a rate cut — except to say that the central bank will continue to look at the data as it comes in.
The worldwide surveys of manufacturing and services sector activity will be out Tuesday and Wednesday. Watch the China data for a slight easing.
Australia sees the April house price data on Wednesday morning and the retail trade figures for March on Tuesday. Thursday sees building approvals for March. Lending finance figures are released Friday. The goods trade figures for March will also be out on Thursday.
AMP Chief Economist Shane Oliver thinks retail sales will be down 0.2% after the rise in February helped by Taylor Swift, that the goods trade surplus is expected to be around $A7 billion, and that private credit data from the Reserve bank tomorrow will show a modest rise. He also sees a 0.6% rise in house prices on Wednesday. Building approvals could be up 2%, and there could be a small rise in housing finance on Friday.
There will be continuing speculation about BHP’s (ASX:BHP) ambitions for Anglo American and what it means, while the National Australia Bank (ASX:NAB) releases its March interim results Thursday, followed by the full 2023-24 financial year year figures from Macquarie Group (ASX:MQG) on Friday.
NAB shares are up 8.6% year to date (Commonwealth Bank (ASX:CBA) shares are down 0.55%). Macquarie shares are up 1%. The ASX 200 is down 0.7% year to date.
Rio Tinto (ASX:RIO) holds its Australian annual meeting in Brisbane later in the week. IGO (ASX:IGO) releases its March quarter production and sales figures tomorrow, along with a host of other miners rushing to meet the April 30 deadline.
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Besides the Fed meeting and the jobs data, this week in the US also sees the important JOLTS data, which measures job vacancies.
Employment costs data will probably show another 4% plus reading, which, in the now inflation-sensitive environment, will probably lead to another bout of chattering from analysts and economists.
Shane Oliver thinks the Fed will sit and repeat “the somewhat less dovish guidance we have seen over the last few weeks with Chair Powell likely to repeat that inflation data has not yet provided the Fed with the greater confidence it wants and so it’s appropriate to leave rates high for longer.”
"But he is also likely to indicate that he doesn’t see the economy overheating and still sees the labour market moving into better balance with wages growth moderating leaving the door open for rate cuts later this year," Dr Oliver wrote in his weekly note.
"Our base case remains for the first cut to come in September, although a July move is still possible,” he forecast.
On jobs, Dr Oliver sees 250,000 new jobs, unemployment unchanged at 3.8% and growth in average hourly earnings edging down further to 4% annual.
The earnings season for the three months to March continues, with Amazon and Apple leading the day.
In Europe, the Eurozone inflation data is expected on Tuesday with a steady 2.4% reading and unemployment on Friday steady at 6.50%. Eurozone March quarter GDP will be out on tomorrow (along with the first inflation estimate for last month).
Japan sees jobs figures for April tomorrow, with inflation slowing to 2.7% and GDP for the March quarter around 0.2% for the three months and year. Industrial production figures will also be issued this week.
First quarter GDP figures will also be released by Taiwan and by Hong Kong this week.
