Sunday, June 29, 2014

The Week Ahead: Jobs, Yellen and the Glorious 4th

The monthly employment and unemployment report dominates economic reporting in a trading week cut short by the U.S. Independence Day holiday.

All U.S. markets will be closed on Friday, July 4, although it will be business as usual in London, Tokyo and Sydney. The jobs report will be published a day earlier than usual, on Thursday at 8:30 a.m. New York time rather than Friday, because of the holiday.

The ADP employment report, a private sector report based on payroll data, will be released Wednesday at 8:15 a.m.

Two other potential market-movers are on the calendar: The Institute of Supply Managers manufacturing index, out Tuesday at 10 a.m., and international trade, released Thursday at 8:30 a.m.

Federal Reserve Chair Janet Yellen delivers the first Michel Camdessus Central Banking Lecture at the International Monetary Fund in Washington, at 11 a.m. Wednesday. Camdessus was the managing director of the IMF from 1987 to 2000.

Leading indicators (in descending order of importance):

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.

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

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

Vendor performance, also called the deliveries time index, from the ISM manufacturing survey, at 10 a.m. Tuesday.

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

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

Manufacturers' new orders for non-defense capital goods from the factory orders report, at 10 a.m. Wednesday.

Other items of interest:

Monday: Chicago purchasing managers index at 9:45 a.m., pending home sales at 10 a.m. and the Dallas Federal Reserve Bank manufacturing survey at 10:30 a.m.

Tuesday: Motor vehicle sales throughout the day, the Purchasing Managers manufacturing index at 9:45 a.m. and construction spending at 10 a.m.

Wednesday:  Factory orders at 10 a.m. and petroleum inventories at 10:30 a.m.

Thursday: Institute of Supply Management non-manufacturing index at 10 a.m.

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


Aside from Fed Chair Yellen, whose appearance is noted above, one other from among the Fed glitterati has scheduled a public appearance: San Francisco Fed Pres. John Williams, an alternate on the Federal Open Market Committee.

Analytical universe

This week I shall be analyzing new bull and bear signals among 3,880 small-cap and larger stocks and exchange-traded funds.

Trading calendar

By my rules, I'm trading August options and later 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 October options and later for single calls and puts as well as straddles. Shares, of course, are good at any time.

Good trading.

-- Tim Bovee, Portland, Oregon, June 29, 2014

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