The first week of any month sets the tone for financial markets (VOO). However, this week is very important. There are many economic data points for investors to watch. US markets (IJH) will be tracking ongoing corporate earnings. US markets could be influenced by multiple economic reports scheduled this week. Reports on personal spending, personal income, core personal consumption expenditure, the manufacturing (XLI) and non-manufacturing PMI, non-farm payrolls, the unemployment rate, and average hourly earnings are all scheduled to be reported this week. Below is a list of the important economic reports scheduled this week.
Payrolls will likely bounce back in April
The stakes are high for the April jobs report, which is scheduled to be reported on Friday, especially after the disappointing payrolls report in March. The April report could prove that the job growth decline in March was only transitory after a stellar addition of 320,000 jobs in February. Wage growth is expected to increase 0.3% month-over-month in April. The year-over-year growth could increase by one percentage point to 2.8%. The FOMC’s meeting is scheduled on Tuesday and Wednesday. The Fed isn’t expected to make any changes to the policy. However, an upbeat take on inflation (TIP) growth and a strong employment market could have a major impact on US bond (AGG) markets on Wednesday.
Setting the tone for markets
This week will likely set the tone for the rest of May. The expectations for corporate performance, inflation (VTIP), job growth, and the Fed’s policy will likely be formed based on the data and earnings reports published this week. Overall, this week could be positive for markets if the earnings are positive and the risks retreat.