The major economic data and financial events for this week (1.1-1.5) are as follows:
In terms of economic data, this week we can focus on China's Caixin manufacturing PMI for December, China's Caixin services PMI for December, US ISM manufacturing PMI for December, US ADP employment in December, and US non-farm payrolls after the December seasonal adjustment. As signs of US inflation cooling down are becoming increasingly clear, outsiders are now focusing their attention on the job market to see if there are any signs of continued loosening.
In terms of Fed dynamics, the Federal Reserve will release the minutes of the December monetary policy meeting, which is expected to reveal more details of discussions on interest rate cuts; Richmond Federal Reserve Chairman Barkin will deliver a speech on the economic outlook.
Also, due to the New Year's Day holiday, Hong Kong and US stocks will be closed for one day on Monday.
Monday 1st January
Keywords: Hong Kong and US stock market closure
During the New Year's Day holiday, the US Stock Exchange, Hong Kong Stock Connect, and Shanghai and Shenzhen Stock Connect will all be closed for one day on January 1 (Monday).
Tuesday January 2nd
Keywords: China's December Caixin manufacturing PMI, US December Markit manufacturing PMI final value
The new year has a new climate. On Tuesday, the Hong Kong and US stock markets will usher in the first trading day of 2024.
In terms of economic data, investors can pay attention to China's Caixin manufacturing PMI for December, the final value of the US Markit manufacturing PMI for December, and the monthly rate of US construction expenditure for November.
The recently released Caixin China Manufacturing Purchasing Managers' Index (PMI) for November recorded 50.7, up 1.2 percentage points from the previous month, and once again rose above the boom and bust line, the highest in three months.
Furthermore, preliminary data from the US PMI for December showed that improvements in the service sector offset the decline in manufacturing. The overall US economy rebounded slightly in December, ending the fastest growth rate since July in 2023.
Wednesday January 3rd
Keywords: US ISM manufacturing PMI in December, number of US JoLTS job vacancies
On Wednesday, in terms of economic data, we can focus on the US ISM manufacturing PMI for December and the number of US Jolts job vacancies in November.
The US ISM manufacturing index for November, which was announced earlier, fell short of expectations and shrank for 13 consecutive months, creating the longest contraction cycle in the last 20 years since the outbreak of the Internet bubble crisis.
Lower wage pressure, combined with a significant cooling in raw material input cost inflation, has caused the average price inflation rate of factory products to fall below the 10-year average before the COVID-19 pandemic. The increase declined again in November, helping to further reduce consumer price inflation in the next few months.
It is worth mentioning that the JoLTS report is one of the labor indicators that US Treasury Secretary Yellen values the most when serving as Chairman of the Federal Reserve. This indicator is also labor market data that the Federal Reserve paid great attention to. The JoLTS data usually lags one month behind the non-farm payrolls data.
In terms of economic events, the 2024 FOMC voting committee and Richmond Federal Reserve Chairman Barkin will deliver a speech on the economic outlook.
Barkin said earlier that the Federal Reserve has made “good progress” in reducing inflation, but he is unwilling to specify a specific schedule for cutting interest rates. However, it emphasized that it is still too early to start speculating on the Federal Reserve's first interest rate cut.
Thursday January 4th
Keywords: number of US jobless claims at the beginning of the week, US ADP employment data, minutes of the Federal Reserve meeting
On Thursday, in terms of economic data, the market will welcome data on the number of jobless claims in the US at the beginning of the week and ADP employment data known as “small non-farmers.” As signs of US inflation cooling down are becoming increasingly clear, outsiders are now focusing their attention on the job market to see if there are any signs of continued loosening.
Earlier reports showed that ADP employment in the US increased by 103,000 in November, falling short of the expected 130,000, and also falling short of the previous revised value of 106,000.
At the same time as the number of employed people is slowing down, the wage growth rate has also cooled down further. The wages of those left behind in November rose 5.6% compared to the same period last year. The growth rate declined for 14 consecutive months, falling to the weakest level of growth since September 2021
Also, in the early morning of the same day, the Federal Reserve will release the minutes of the December monetary policy meeting. Among the many important factors affecting the trend of US stocks, the Fed's attitude towards interest rate cuts has unquestionably become the focus of market attention.
At the meeting on December 13, the Federal Reserve once again decided to keep interest rates unchanged. Chairman Powell also revealed that “interest rate cuts have begun to come into view, and policymakers are thinking and discussing when it is appropriate to cut interest rates.”
According to the “bitmap” released at the time, officials generally believe that the federal funds rate level will drop to 4.5% to 4.75% by the end of 2024. This means that at a rate of 25 basis points each time interest rate is cut, interest rates may be cut three times next year. Further details on these decisions will be provided in the forthcoming minutes.
Friday January 5th
Keywords: US non-farm payrolls added in December, US unemployment rate
On Friday, the most notable economic data was the US “Non-Farm Report.”
Currently, economists expect the number of non-farm workers to increase by 158,000 in December, down from 199,000 in November, while the unemployment rate will rise slightly to 3.8%. The average hourly wage is not expected to change drastically. The salary growth rate is expected to be 0.3% month-on-month, 3.9% year-on-year, and 4.0% compared to the previous value.
J.P. Morgan believes that more than 80% of total employment growth in December came from health care and social assistance and the public sector, and rising interest rates have had little impact on these industries.
It is worth mentioning that data released by several US regional federal banks shows that the US job market will cool down further in 2024, wage increases are expected to slow down, and inflationary pressure will be reduced. The market will further help the expectations of the Federal Reserve's high interest rate cuts next year.
In terms of new shares,$ROBOSENSE (02498.HK)$It will go public in Hong Kong.
Looking back on the past is a better start,
The advance of investment starts now,
I wish the Cow friends the best of luck and good fortune!
Editor/Corrine