The Week Ahead on Wall Street
Economic Data Points
Last week, the latest jobless claims report reached 3.84 million. This pushed the total number of jobs lost over the past six weeks to a heartbreaking 30.3 million. US consumer spending also tumbled 7.5% in March. According to the Commerce Department, this was the steepest drop in the history of the report, which dates back to 1959. Heading into May, investors will be tasked with digesting more updated economic reports for April, the first full month to show the impact of the coronavirus. Here is what to watch in the week ahead:
This morning, factory orders for March are released. When this economic indicator increases, it generally signifies that the economy is expanding, and vice versa when it decreases. March numbers will likely show the initial impact of the coronavirus on factory output in the US.
Tomorrow, watch for figures related to the trade deficit. Also look out for the Markit Services PMI, or Purchasing Managers’ Indexes, a monthly economic indicator based on surveys of private sector companies. The ISM Non-Manufacturing Index will also be released tomorrow.
On Wednesday, the ADP employment report is due. This report is released two days ahead of the more detailed monthly Bureau of Labor Statistics’ report. It is compiled by Automatic Data Processing Inc. (ADP), which handles payroll for about 20% of US private employers. The company is in a unique position to inform investors about the country’s employment situation.
Thursday will be an important day to watch as another jobless claims report is published. Though these reports have continued to be discouraging, Paycheck Protection Program checks have been going out to small businesses across the country. This report will be an early indicator as to whether the program is successfully protecting jobs. Also be on the lookout for Q1 productivity and unit labor cost reports today.
To round out the week, Friday will be extremely important to watch especially as it relates to the job market. Nonfarm payrolls for April will be published. The report is expected to show a steep loss and add more color to Thursday’s initial claims report. Additional context will be provided by way of average hourly earnings and an update on the unemployment rate, which are also released.
Both the US and global economies are halfway through one of the strangest earnings seasons in history. Some sectors have seen unprecedented downturns, while others are growing. The majority of companies are withdrawing future guidance, though the S&P 500 is actually only down roughly 15% from its historic pinnacle. Here are a few earnings reports to look out for this week:
Tyson Foods Inc. (TSN), one of the country’s largest meat producers, will report earnings today. The company has been coping with supply chain shifts and now faces another setback as nearly 900 of its workers in a plant in Indiana tested positive for COVID-19 last week.
Disney (DIS) gives an update on its earnings tomorrow. The company has faced park closures and movie release delays due to coronavirus, but its streaming service, Disney+ has seen explosive growth as families stuck at home look for entertainment. The company also recently began making plans to reopen its parks with new social distancing measures in place.
General Motors (GM) reports on Wednesday. The carmaker is putting plans in place to reopen its US factories while protecting workers from coronavirus with new sanitation measures, protective equipment, and social distancing regulations.
Ride-share giant, Uber Technologies (UBER), will deliver its earnings report on Thursday. The company has seen its business shrink by 70% in most major cities and its stock has fallen 50% over the past month. However, it has seen gains in its food delivery service, Uber Eats.
To finish off the week, Siemens AG (SMAWF), the German multinational conglomerate, will report earnings. The company’s stock has been up 16.7% over the past month, which may indicate that investors are hopeful about the company’s future.
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