Economic Events That Move The Market

Upcoming economic events to keep your eye on

The S&P U.S. Manufacturing Purchasing Managers Index (PMI) has kicked the week off with its report being released today at 9:45 a.m. Eastern. 

The PMI measures the prevailing direction of economic trends in manufacturing. Today’s data provided a positive reaction that gave the market a slight boost. In the current market environment, the big players on Wall Street are actively looking for signs of hope.

The released data indicated that PMI for September was 52.0, better than expected and previous. The economic release expectations were the same as the August report of 51.8. 

A PMI Report uses the baseline of 50 to represent growth or contraction within the economy’s manufacturing sector compared to the prior month. Any number higher than 50 indicates growth or expansion month over month. Conversely, any number below 50 indicates a reduction or contraction from the previous month.

In the short term, the market has used the most recent data to push forward with some bullish sentiment. The stock market will be moving on a report-to-report basis, so it will be essential to know what will come throughout the rest of this week.

What’s next?

The subsequent economic events that could impact the market will come on Wednesday. The Automatic Data Processing (ADP) national employment report is scheduled to release before the cash session opens at 8:15 a.m. Eastern. In addition, the S&P services PMI will be released at 9:45 a.m. Eastern.

The PMI regarding services should be digested the same as the manufacturing report from today. 

The ADP employment report is expected to arrive at 216,000, an 84,000 increase from the previous economic release of 132,000. 

ADP is a research institute that measures the change in the number of employed people in the U.S on a month-to-month basis. The market uses this data to determine if there is growth in the workforce which can generally indicate positive implications for consumer spending, stimulating economic growth. 

To conclude the week, nonfarm payroll (NFP) will be reported on Friday at 8:30 a.m. Eastern. The NFP is an employment compilation of those in goods, construction, and manufacturing companies. As the name insinuates, the report does not account for farm workers. In addition, private household employees and non-profit organization employees are also excluded. 

The economic data can be read similarly to the ADP as substantial numbers indicate the economy’s strength compared to the previous month. 

The forecasted number is 275,000, a 40,000 decrease month over month from the previous report of 315,000. If the data reveals numbers better than what the estimation is, the market can react positively to end the week,

A look into next week

Although the Federal Open Market Committee (FOMC) minutes meeting is not this week, the meeting will play a factor in how the market will move as the anticipation builds.

The FOMC minutes meeting will take place next Wednesday at 2 p.m. Eastern.