Ben Potter, IG Markets
This week will be a relatively busy week compared to weeks gone by. On Tuesday, Australian Building Approvals and Retail Sales are due to be released. In the US, it is Non-Farm Payrolls week with the ADP Non-Farm Employment Change due Tuesday night and then Non-Farm Payrolls on Friday evening.
For the past nine months straight, building approvals have missed their forecasts on the downside. Given this trend, we won’t be surprised at all if February’s building approvals miss the mark yet again.
They are likely to reflect further falls in construction activity since the start of this year. The drop in interest rates and improvements in housing affordability have yet to really filter through to the construction sector. However, in the coming months these forces should start to help this space.
The biggest drag for the construction sector has been the availability of credit as banks have become a lot more risk averse in their lending. This has been especially noticeable for the stgelopers of apartments.
Overnight, the jobless claims in the US rose 122,000 to a seasonally adjusted 5.56 million, another new record. Given this result, it’s highly likely we’ll see another disastrous non-farm payrolls number next week, probably over the 600,000 level again. This will be a real reality check for equity markets given the recent rally. It’s subsequent reaction to the result will be crucial.
EU: ECB President Trichet Speaks (0130)
US: CB Consumer Confidence (0100);
AU: Building Approvals & Retail Sales (1130)
UK: Manufacturing PMI (1930)
US: ADP Non-Farm Employment Change (2315)
Interim Results: Nufarm Ltd
US: ISM Manufacturing PMI & Pending Home Sales (0100)
AU: Trade Balance (1130)
EU: Minimum Bid Rate (2245), ECB Press Conference (2330)
US: Unemployment Claims (2330)
UK: Services PMI (1930)
US: Non-Farm Employment Change & Unemployment Rate (2330)
US: ISM Non-Manufacturing PMI (0100)
Fed Chairman Bernanke Speaks (0300)
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