A new month means another chance to assess the state of employment in the US, and whether or not jobs creation has remained in the millions.
US: Can nonfarm jobs creation keep in the millions?
Though not quite as strong as its tech-supported, all-time high-hitting Nasdaq and S&P peers, the Dow Jones still had a hell of an August, resuming the path back towards its own record peak. And that’s in a month that saw continued coronavirus headlines, and some nasty spikes in US-China tensions.
Will it be able to continue its climb in September? The first major obstacle – or aid – arrives on Friday, in the form of the latest nonfarm jobs report. Still a long way from clawing back the near 21.5 million jobs lost across March and April, the figures for May, June and July have all be strong, rising from 2.509 million to 4.8 million, before falling back to 1.763 million.
The markets will likely take any 7-digit figure on Friday; however, a further decline on that July reading would perhaps be cause for concern.
As for the unemployment rate, that’s sitting at 10.2%, seeing 3 consecutive months of decline after spiking to 14.7% in April. Average hourly earnings, meanwhile, unexpectedly eked out an increase in July, edging up 0.2% after 2 months of contraction. Further progress would be welcome.
Before that, the ISM and final Markit manufacturing PMIs are released on Tuesday, with the latter looking to improve on the 53.6 flash reading. Factory orders and the ADP nonfarm number are then on Wednesday, before the usual Thursday jobless claims are joined by the ISM and final Markit services PMIs. The flash reading for the latter was 54.8.
UK: A shorter week for the FTSE
The FTSE’s Bank Holiday-shortened week kicks off with the final manufacturing PMI reading on Tuesday, with a flash figure of 55.3 the number to beat. Tuesday also sees the latest mortgage approvals and net lending to individuals figures.
On Thursday there is the final services PMI reading for August. The ‘Eat Out to Help Out’ scheme saw the flash estimate shoot to a 6-year high of 60.1, so investors won’t want to see any backsliding.
Finally on Friday the construction PMI for August is joined by the consumer inflation expectations.
Eurozone: Economic data
The Eurozone week has a similar shape to the UK’s. The final manufacturing PMIs on Tuesday come alongside the German and Italian unemployment change figures, and the region-wide unemployment rate and inflation data.
Wednesday then sees the PPI reading, with the final services PMIs and Eurozone-wide retail sales on Thursday, and German factory orders on Friday.
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