Sunday, March 2, 2014

The Week Ahead: From what we make to how we make it

The week begins with what we make and spend -- personal income and outlays on Monday -- and ends with how we make it, or not -- the employment and unemployment report on Friday. Each will be released at 8:30 a.m. New York time.

The jobs report will get sneak preview in the ADP employment report at 8:15 a.m. on Wednesday. It is issued by the largest U.S. payroll services company and often moves the the markets prior to the government's release.

Other major reports during the week are the Institute of Supply Management's manufacturing index at 10 a.m. on Monday and the international trade report at 8:30 a.m. on Friday.

Leading indicators (in descending order of importance):

Average hourly workweek in manufacturing from the employment report, at 8:30 a.m. Friday.

Manufacturers' new orders for consumer goods and materials from the factory orders report, at 10 a.m. Thursday.

Vendor performance, also called the delivery times index, from the ISM manufacturing index, Monday at 10 a.m.

The interest rate spread between 10-year Treasuries and the federal funds rate, reported continually during market hours.

The M2 money supply, at 4:30 p.m. Thursday.

The S&P 500 index, reported continually during market hours.

Average weekly initial jobless claims, at 8:30 a.m. Thursday. 

Other reports of interest:

Monday: Motor vehicle sales throughout the day, the PMI manufacturing index shortly before 9 a.m. and construction spending at 10 a.m.

Wednesday: The ISM non-manufacturing index at 10 a.m., petroleum inventories at 10:30 a.m. and the Federal Reserve's Beige Book at 2 p.m.

Thursday: Productivity and costs at 8:30 a.m., factory orders at 10 a.m. and the Federal Reserve money supply report at 4:30 p.m.

I also keep an eye on the Baltic Dry Index, updated daily.


Two Federal Open Market Committee members take to the podium during the week: Dallas Fed Pres. Richard Fisher on Wednesday and New York Fed Pres. William Dudley on Friday.

Three FOMC alternates are on the calendar: Richmond Fed Pres. Jeffrey Lacker on Tuesday, San Francisco Fed Pres. John Williams on Wednesday and Atlanta Fed Pres. Dennis Lockhart on Thursday.

Analytical universe

This week I shall be analyzing new bull and bear signals among 3,838 small-cap and larger stocks and exchange-traded funds.

Trading calendar

By my rules, I'm trading April options for the short legs of vertical, diagonal and calendar spreads and covered calls, and for all legs of butterfly spreads and iron condors. I'm trading June options for single calls and puts as well as straddles. Shares, of course, are good at any time.

Good trading.

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