Welcome to Michael Kramer's top three market events to watch for the week starting Monday, April 1 (below). Also check out his video preview of the week ahead (above) from RRG Research's Trevor Neal.
The first week of April is full of economic indicators that look back on March. You won't have to wait long either, with the March ISM Manufacturing Report on April 1st, followed by the Eurozone CPI Inflation Report on April 3rd, the ISM Services Report on April 3rd, and the March ISM Manufacturing Report on April 5th. The US employment report for the month is released. All this data can influence markets such as foreign exchange, indices, stocks, and interest rates.
US Purchasing Managers Index
Monday, April 1st/Wednesday, April 3rd: Analysts expect the US ISM manufacturing business index to improve to 48.4 from 47.8 in March, and the new orders index to rise to 49.8 from 49.2. Both indicate that the sector is still contracting, but readings above 50 indicate it is close to expansion. Last month's price paid index was 52.5. A high number may indicate that the cost of the product is increasing.
The U.S. ISM service on April 3 is expected to be 52.8, up from 52.6 the previous month. An important factor may be the price paid for services index, which hit 58.6 last month. A high value could indicate that U.S. services inflation is continuing but not falling, or worse, accelerating.
Better-than-expected ISM data could cause markets to continue lowering the probability of a US rate cut, while weaker data could cause markets to price in further rate cuts. This means that the 2-year yield is likely to be most affected by this data. It turns out that there is a strong resistance level at 4.75%, and if the data is good, there is a possibility of a breakout and above the resistance level. On the other hand, if the data is weak, it could fall to around 4.5%, and if it falls below 4.5%, the double top pattern could be confirmed and it could return to 4.20%.
euro area consumer price index
Wednesday, April 3rd:The overall euro area CPI value for March is expected to increase by 0.7% month-on-month, up from 0.6% in the previous month, and on a year-on-year basis, it is expected to increase by 2.6%, the same as last month. Core CPI is expected to rise 3% year-on-year, down from 3.1% last month.
The euro, which has been strong recently, may be the most affected by these results. However, the euro is currently depreciating against the US dollar, suggesting this consolidation may end. A higher Eurozone CPI report could cause the euro to break above and head towards the resistance at 1.095, while a lower report could result in a fall below the support at 1.08 and a possible fall to 1.07. A rise to 1.095 or 1.07 would move the euro outside the consolidation wedge.
US employment statistics
Friday, April 5th: Analysts expect the U.S. economy to add 216,000 jobs in March, down from 275,000 in February. Meanwhile, the unemployment rate is expected to fall from 3.9% to 3.8%, and average hourly wages are expected to rise by 0.1% to 0.3% month-on-month.
The U.S. stock market tends to see a lot of unexpected volatility around this report, and many investors are wondering why some reports suggest the market is It's going up, and some are wondering if it's going to go down. To do that, we need to look at the VIX daily value and see where the closing price level is. The higher the implied volatility, the more likely the stock market will rise regardless of the data, even if the rise is short-lived.
For the S&P 500 or Nasdaq 100 to make a big move, the VIX daily index would need to reach around 20 the day before the report. In the past employment report, the level of implied volatility has never been high enough to cause a large rally, as it was on February 22nd, the day after the NVIDIA report, and March 12th, the day after the CPI report. . If implied volatility is high enough in the previous day, a head-scratching stock market rally can occur.
Major economic and corporate events
Here's a summary of notable economic announcements and company reports scheduled for next week.
Monday, April 1st
- China Purchasing Managers Index – Manufacturing
- US Purchasing Managers Index – Manufacturing
- result: AST Space Mobile (Q4); Nano-X Imaging (Q4); PVH Corp (Q4)
Tuesday, April 2nd
- Reserve Bank of Australia Monetary Policy Meeting Minutes
- Euro Area Purchasing Managers Index – Manufacturing
- UK Purchasing Managers Index – Manufacturing
- usa durable goods
- result: Calmaine Foods (Q3); Dave & Buster's Entertainment (Q4); Paychex (Q3), updated (HY)
Wednesday, April 3rd
- China Purchasing Managers Index – Services
- Euro Area Consumer Price Index.Unemployment rate
- US EIA Weekly Oil Status Report – Crude Oil Inventories. Fed Chairman Jerome Powell Speech
- result: Acuity Brands (2nd quarter); ExxonMobil (1st quarter). Hilton Food Group (FY); Impax Environmental Market (FY); Levi Strauss (Q1)
Thursday, April 4th
- Euro Area Purchasing Managers Index – Services.producer price index
- UK Purchasing Managers Index – Services
- U.S. Unemployment Insurance Claims.trade balance
- result: Conagra Brands (Q3); Kura Sushi (Q2); Lamb Weston (Q3); Lindy (Q2); Radius Recycle (Q2); RPM International (Q3); Simply Delicious Food ( Q2)
Friday, April 5th
- UK Purchasing Managers Index – Construction
- US non-farm payrolls.unemployment rate; average income
- result: Ermenegildo Zegna (year)
Note: All dates have been carefully checked to ensure accuracy at the time of writing, but the above announcements are subject to change.
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