For the week of March 8th:
In conjunction with Econoday:
This is a very slow news week following 9 straight week’s of heavy news. Aside from jobless claims on Thursday and retail sales on Friday there is almost no market moving news. Volume should be extraordinarily low and any surprise news events will be market movers. The earnings calendar is mostly empty. It will be interesting to see if equities can find a catalyst to cling to following the big move we’ve seen over the preceding four weeks. Let’s take a look at what’s on tap:
Monday – No economic news. H&R Block reports after the close, but should not be market moving.
Tuesday – Light economic news day. No earnings reports of significance.
ICSC-Goldman Store Sales 7:45 AM ET
Redbook 8:55 AM ET
Wednesday – Another light news day. No significant earnings.
EIA Petroleum Status Report 10:30 AM ET
Treasury Budget 2:00 PM ET
The U.S. Treasury monthly budget report posted a deficit of $42.6 billion in January, bringing the year-on-year rise in the fiscal year-to-date deficit down to 8.8 percent from 16.8 percent in December. The improvement came from the outlay side which was down 3.9 percent from a year ago. In particular, outlays related to TARP fell to $125 million, compared to December’s $3.9 billion. Looking ahead, for historical perspective, the month of February typically shows a deficit for the month. Over the past 10 years, the average deficit has been $108.0 billion and $144.3 billion over the past 5 years. The February 2009 deficit came in at $192.8 billion.
Treasury Statement Consensus Forecast for February 10: -$223.0 billion
Thursday – Jobless claims in the morning. National Semiconductor reports after the bell. Tech could be looking for a cue from the semiconductor giant.
International Trade 8:30 AM ET
Jobless Claims 8:30 AM ET
EIA Natural Gas Report 10:30 AM ET
The U.S. international trade gap in December unexpectedly ballooned to $40.2 billion from a $36.4 billion gap in November. The worsening in the trade deficit was largely due to a widening of the petroleum deficit as the nonpetroleum gap actually shrank. The good news was that exports jumped 3.3 percent in December—the eighth consecutive monthly increase. The trade gap could worsen again in January as the seasonally adjusted price of West Texas Intermediate jumped about 9 percent on a monthly basis.
International trade balance Consensus Forecast for January 10: -$41.0 billion
Initial jobless claims for the week of February 27 swung lower, declining 29,000 to 469,000. There were no special factors in the week. Filings were up the prior week due to severe weather. Now many file online rather than waiting in line and being snowed in at home may have actually boosted online filings. The weekly data for February showed steep swings. The four-week average, however, fell 3,500 in the week to 470,750, a level showing no significant change from late January.
Jobless Claims Consensus Forecast for 3/6/10: 460,000
Friday – Retail sales and consumer sentiment will drive market action.
Retail Sales 8:30 AM ET
Consumer Sentiment 9:55 AM ET
Business Inventories 10:00 AM ET
Retail sales in January posted a healthy rebound of 0.5 percent after dipping 0.1 percent the month before. Excluding autos, sales in January were up 0.6 percent, following December’s drop of 0.2 percent. Components were mixed with gasoline playing an essentially neutral role. Excluding both autos and gasoline, January sales rebounded 0.6 percent, following a 0.3 percent decrease in December. Better-than-expected store sales for February have raised hopes that February will continue the uptrend in overall retail sales. But unit new motor vehicles sales fell 4.2 percent for the month and likely will dampen retail sales.
Retail sales Consensus Forecast for February 10: -0.2 percent
Retail sales excluding motor vehicles Consensus Forecast for February 10: 0.0 percent
The Reuter’s/University of Michigan’s Consumer sentiment index edged lower in February, extending the recent recession’s run of very weak readings. Reuters/University of Michigan’s consumer sentiment index for the full month of February slipped to 73.6 from 73.7 at mid month and compared to 74.4 in January. Expectations dipped lower in the latest report while current conditions improved. Most analysts are counting on a little bounce back but higher gasoline prices and a weak labor market likely will keep sentiment low in March.
Consumer sentiment Consensus Forecast for preliminary March 10: 74.0
Business inventories slipped 0.2 percent in December after two moderate gains of 0.5 percent in November and 0.3 percent in October. For the latest month, the decline was led by a 0.8 percent fall in wholesale inventories. A large part of wholesale inventories are imports. The other two components of business inventories also were soft with manufacturing inventories dipping 0.1 percent and retail inventories unchanged. More recently, factory inventories rose 0.2 percent in January. We will get an update on wholesale inventories for January on Wednesday, March 10.
Business inventories Consensus Forecast for January 10: +0.2 percent
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.