The Week Ahead: 29th April – 3rd May 2024

Overview for the Week Ahead

Highlights of the Week

US ISM Services PMI, the Jobs Report, and the US Federal Reserve will put the US dollar in focus.
GDP and inflation numbers for euro area member states and the Eurozone will influence the ECB rate path.
Private sector PMI numbers from China will impact market risk sentiment.

Hints of whether the Fed still expects interest rate cuts at some point this year take centre-stage for investors at the central bank’s meeting that concludes on Wednesday.

Rate action is unlikely, but comments from Fed Chair Jerome Powell about the potential for policy easing later in 2024 will be scrutinized.

On Friday (May 3), average hourly earnings, nonfarm payrolls, and unemployment rate are the more influential labor market indicators. Beyond the labor market, the ISM Non-Manufacturing PMI also needs consideration. The services sector is a contributor to inflation. Input costs, employment, and new order trends will also move the dial.

The last of the “Magnificent Seven” megacaps that drove a fiery stock rally in 2023 to report are Amazon, reporting Tuesday, and Apple, on Thursday.

Apple shares have lost their lustre in 2024, tumbling over 10%. The iPhone maker is expected to post a decline in first quarter earnings after China smartphone shipments fell 19%.

Amazon’s cloud computing business will be in focus while investors will be attuned to the online retailing giant’s view of consumer spending. Its shares are faring better so far this year, having risen 18% as of Wednesday.

Meanwhile, tech regulation is also on the front burner. President Joe Biden just signed legislation that bans TikTok in the United States if Chinese owner ByteDance fails to divest the short video app over the next nine months to a year.

For Europe, investors should monitor ECB chatter. Views on inflation, the economic outlook, and the timeline for interest rate cuts need consideration.

With U.S. inflation running hot and the Fed viewed as likely to hold rates high, markets price 60 bps of cuts by the ECB this year as it remains wary of the euro weakening too much against a supercharged dollar.

On Wednesday, UK manufacturing sector PMI numbers will put the Pound in focus.

While the manufacturing sector accounts for less than 30% of the UK economy, the PMIs could reflect the demand environment. Downward revisions to the preliminary April survey could pressure the Pound.

UK house price trends could also move the dial. A continued decline in house prices could impact consumer confidence and spending. Downward trends in consumer spending may dampen demand-driven inflation.

On Friday, the all-important Services PMI will be in focus. An upward revision to the preliminary Services PMI could test investor bets on a Bank of England rate cut. The UK services sector accounts for over 70% of the UK economy and contributes to inflation.

Beyond the numbers, Bank of England speeches also need monitoring.

Have your trading charts ready this week!

This Week’s High Impact Events

The times below are GMT +3.

Monday 29^th April

All Day – Europe – German Prelim CPI m/m

Potential instruments to Trade: EUR Crosses. 

Tuesday 30^th April

04.30 – China – Manufacturing PMI

Potential instruments to Trade: CNY Crosses. 

15.30 – Canada – GDP m/m

Potential instruments to Trade: CAD Crosses. 

15.30 – US – Employment Cost Index q/q

Potential instruments to Trade: USD Crosses. 

17.00 – US – CB Consumer Confidence

Potential instruments to Trade: USD Crosses. 

Wednesday 1^st May

01.45 – New Zealand – Employment Change q/q, Unemployment Rate

Potential instruments to Trade: NZD Crosses. 

15.15 – US – ADP Non-Farm Employment Change

Potential instruments to Trade: USD Crosses. 

16.45 – US – Final Manufacturing PMI

Potential instruments to Trade: USD Crosses. 

17.00 – US – ISM Manufacturing PMI, JOLTS Job Openings

Potential instruments to Trade: USD Crosses. 

21.00 – US – Federal Funds Rate, FOMC Statement

Potential instruments to Trade: USD Crosses. 

21.30 – US – FOMC Press Conference

Potential instruments to Trade: USD Crosses. 

23.15 – Canada – BoC Gov Macklem Speaks

Potential instruments to Trade: CAD Crosses. 

Thursday 2^nd May

09.30 – Switzerland – CPI m/m

Potential instruments to Trade: CHF Crosses. 

15.30 – US – Unemployment Claims

Potential instruments to Trade: USD Crosses. 

15.45 – Canada – BoC Gov Macklem Speaks

Potential instruments to Trade: CAD Crosses. 

Friday 3^rd May

15.30 – US – Average Hourly Earnings m/m, Non-Farm Employment Change, Unemployment Rate

Potential instruments to Trade: USD Crosses. 

17.00 – US – ISM Services PMI

Potential instruments to Trade: USD Crosses. 

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