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S&P 500 & US Indexes Fundamental Forecast – May 5, 2016
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U.S. Stock indices were trading mostly lower during the early session. Follow-through selling from Tuesday continued to drive the market lower. Most of
U.S. Stock indices were trading mostly lower during the early session. Follow-through selling from Tuesday continued to drive the market lower. Most of the pressure was coming from renewed concerns about a possible interest rate hike after two Fed officials mentioned the possibility of a rate hike later this year late on Tuesday.
Atlanta Fed President Dennis Lockhart said the United States could see two further interest rate hikes this year. San Francisco Fed President John Williams said Tuesday that he would support an interest-rate hike in June as he sees continued progress in the economy, inflation and jobs.
Global markets were also negatively influencing the indices early in the session. China’s Yuan appeared to be a key factor, diving sharply after the People’s Bank of China loosened its peg to the dollar.
Stocks were expected to open lower on Wednesday, though there was some evidence that investors were trying to pare losses. The NASDAQ, Dow Jones Industrial Average and S&P 500 were all expected to open around 0.3% lower.
Shortly before the opening, traders were reacting to the ADP Non-Farm Employment Change report which showed the private sector added only 156,000 jobs to the economy in April. Traders were expecting at least 195,000 with some predictions as high as 205,000.
Non-farm productivity declined 1% in the first quarter vs. fourth quarter, according to preliminary estimate from the Labor Department. Consensus projections called for a 1.2% decrease. Labor costs jumped 4.1%, above estimates for a 3.5% rise.
Later today investors will get the opportunity to react to the latest U.S. Final Services report, ISM Non-Manufacturing PMI and Factory Orders.
FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.
Today’s economic releases:
| Cur. | Event | Actual | Forecast | Previous |
| USD | API Weekly Crude Oil Stock | 1.265M | 0.500M | -1.070M |
| USD | API Weekly Cushing Crude Oil Stock | 0.382M | 1.900M | |
| NZD | Employment Change (QoQ) (Q1) | 1.2% | 0.7% | 0.9% |
| NZD | Unemployment Rate (Q1) | 5.7% | 5.5% | 5.3% |
| USD | FOMC Member Lockhart Speaks | |||
| JPY | Japan – Greenery Day | |||
| EUR | German Services PMI (Apr) | 54.5 | 54.6 | 54.6 |
| EUR | Markit Composite PMI (Apr) | 53.0 | 53.0 | 53.0 |
| EUR | Services PMI (Apr) | 53.1 | 53.2 | 53.2 |
| GBP | Construction PMI (Apr) | 52.0 | 54.0 | 54.2 |
| EUR | Retail Sales (MoM) (Mar) | -0.5% | -0.1% | 0.3% |
| EUR | German Buba President Weidmann Speaks | |||
| USD | ADP Nonfarm Employment Change (Apr) | 156K | 196K | 200K |
| USD | Nonfarm Productivity (QoQ) (Q1) | -1.0% | -1.4% | -2.2% |
| USD | Trade Balance (Mar) | -40.4B | -41.50B | -47.10B |
| USD | Unit Labor Costs (QoQ) (Q1) | 4.1% | 3.3% | 3.3% |
| CAD | Trade Balance (Mar) | -3.4B | -1.40B | -1.91B |
| USD | Markit Composite PMI (Apr) | 51.7 | ||
| USD | Services PMI (Apr) | 52.1 | 52.1 | |
| USD | Factory Orders (MoM) (Mar) | 0.6% | -1.7% | |
| USD | ISM Non-Manufacturing Employment (Apr) | 50.3 | ||
| USD | ISM Non-Manufacturing PMI (Apr) | 54.7 | 54.5 | |
| USD | Crude Oil Inventories | 1.695M | 1.999M | |
| USD | Cushing Crude Oil Inventories | 1.746M | ||
| USD | FOMC Member Kashkari Speaks | |||
| AUD | HIA New Home Sales (MoM) (Mar) | -5.3% | ||
| AUD | Retail Sales (MoM) (Mar) | 0.3% | 0.0% | |
| AUD | Trade Balance (Mar) | -2.900B | -3.410B | |
| CNY | Caixin Services PMI (Apr) | 52.6 | 52.2 |
Upcoming Economic Events that you should be monitoring:
Thursday, May 5, 2016
| Cur. | Event | Actual | Forecast | Previous |
| JPY | Japan – Children’s Day | |||
| GBP | Halifax House Price Index (MoM) | 0.1% | 2.6% | |
| GBP | Halifax House Price Index (YoY) | 9.6% | 10.1% | |
| EUR | ECB Economic Bulletin | |||
| GBP | Services PMI (Apr) | 53.5 | 53.7 | |
| USD | Initial Jobless Claims | 260K | 257K | |
| CAD | Building Permits (MoM) (Mar) | -5.0% | 15.5% | |
| USD | FOMC Member Bullard Speaks | |||
| USD | FOMC Member Bullard Speaks | |||
| USD | FOMC Member Kaplan Speaks | |||
| USD | FOMC Member Lockhart Speaks | |||
| USD | FOMC Member Williams Speaks | |||
| AUD | RBA Monetary Policy Statement |
Government Bond Auctions
Date Time Country Auction
May 04 11:05 Norway Holds bond auction
May 04 11:30 Germany Eur 4bn Apr 2021 Bobl
May 04 11:30 UK Gbp 2.75bn 1.5% 2021 Gilt
May 04 11:50 France Holds bond auction
May 04 17:20 Sweden Details of bond auction on May 11
May 05 10:30 Spain Holds bond auction
May 05 11:00 Austria Holds bond auction
May 05 11:30 UK Gbp 2.5bn 1.5% 2026 Gilt
May 09 17:20 Italy Announces details of bond auction
May 09 N/A Ireland Details of bond auction on May 12
May 10 11:30 Germany Holds I/L bond auction
May 11 11:03 Sweden Holds bond auction
May 11 11:30 Germany Eur 5bn Jun 2018 Schatz
May 12 11:10 Italy Holds bond auction
May 12 17:20 Sweden Details of I/L auction on May 19
May 12 N/A Ireland Holds bond auction
About the Author
James Hyerczykauthor
James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.
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