Monday, August 5th, caught many off guard as stocks tumbled. Major companies like Intel and SNAP saw their share prices plummet by over 26% over the weekend. Meanwhile, key indices such as Nasdaq, S&P 500, and Dow Jones all dropped by 2.5% or more in just the past 24 hours.
This market downturn follows a series of concerning economic indicators. Last week's jobs report came in weaker than expected, unsettling investors. Additionally, the manufacturing sector showed a more significant contraction than anticipated last month.
Looking ahead, investors will be closely watching several key economic reports this week.
🇺🇸 ISM Non-Manufacturing PMI — August 5, at 17:00 GMT+3
All eyes are on the upcoming release of the ISM Non-Manufacturing PMI (Purchasing Managers' Index) this Monday, a crucial indicator of the U.S. services sector's health. This report gains particular significance in light of last week's declining manufacturing PMI, which fueled economic concerns.
Analysts forecast an ISM Non-Manufacturing PMI reading of 51.3, up from the previous month's 48.8. This anticipated improvement could signal a rebound in services sector activity, potentially alleviating some economic worries. The report's impact may extend to currency markets, particularly affecting the EUR/USD pair. Recently, this pair touched a three-week low of 1.0776 before rebounding to close above the 1.0900 mark.
A stronger-than-expected PMI could influence further movements in this closely watched currency pair, underscoring the interconnectedness of economic indicators and financial markets.
🇪🇺 Retail Sales m/m — August 6, at 12:00 GMT+3
Attention turns to the upcoming release of the European Retail Sales month-over-month data, a key indicator of consumer spending trends in the Eurozone. Following last month's modest growth of 0.1%, analysts are projecting no change in the latest figures.
The retail sales data will be closely watched by investors and policymakers alike, as it provides valuable insights into consumer confidence and overall economic health. While no growth is expected, any deviation from this forecast could have implications for the Euro and European markets. As always, this economic indicator will be viewed in the context of broader economic trends and monetary policy considerations.
🇺🇸 Initial Jobless Claims — August 8, at 15:30 GMT+3
Wrapping up the week's economic calendar, all eyes will be on the U.S. Initial Jobless Claims report. This crucial labor market indicator is forecast to come in at 239K, down from the previous week's 249K. The data will provide valuable insights into the current state of the U.S. job market and overall economic health.
The jobless claims report has the potential to impact several key financial instruments. Major U.S. stock indices including the S&P 500, Dow Jones, and Nasdaq could see movement based on the results. Additionally, the U.S. Dollar may react to this data. Investors should also keep an eye on gold prices, which reached a local high of $2,450 earlier this week. A significant deviation from the expected jobless claims figure could influence these markets, underscoring the report's importance in the broader economic landscape.
💰 Earnings Spotlight: Eli Lilly, Disney, Uber, and More
As earnings season begins to wind down, with over 75% of S&P 500 companies having already reported, several key players are still set to release their quarterly results. Monday will see Palantir's update, which may shed light on the company's growth through its AI platforms. Uber is scheduled for Tuesday, following a surprising first-quarter loss due to investment adjustments.
Wednesday brings Walt Disney's report, with analysts anticipating a return to profitability, buoyed by growth in its experiences segment and unexpected profits in direct-to-consumer entertainment. Thursday's focus shifts to the pharmaceutical sector, with Eli Lilly's earnings potentially showcasing the continued success of its weight-loss drugs. Gilead's financial report will also be closely watched, coming on the heels of positive results from its HIV treatment study.
That's it for this week! 👋
