FXStreet (Mumbai) – Some important market-moving indicators will be released today in the U.S. before the Thanksgiving holiday begins. The durable goods orders, which are expected to show a rare advance, will be released. Markets wait to see whether October proved to be as good for durable goods orders as it was for manufacturing production. Personal Consumption Expenditure data is also scheduled to be released today. The PCE prices are expected to build a little pressure. Initial jobless claims are expected to decline pointing towards a robust labour market. New home sales data to be released today close on the heels of Monday’s existing home sales, will mark an end to the week.
Durable Goods and PCE
The durable goods order for October is expected to increase to 1.5 per cent from the previous -1.2 per cent. Given that durable products often involve large investments they are of great significance as they help to gauge to the US economic situation. The final figure shows the state of US production activity.
The Core Personal Consumption Expenditure released by the US Bureau of Economic Analysis is expected to remain unchanged at 1.3 per cent year on year. Core PCE month on month is expected to remain unchanged at 0.1 per cent. Core PCE excludes seasonally volatile products such as food and energy to accurately calculate expenditure. Core PCE is a significant indicator of inflation.
Jobless Claims
The Labor Department on 19th November reported that the initial claims for state unemployment benefits slipped 5,000 to a seasonally adjusted 271,000 for the week ended Nov. 14 implying that the labor market has remained resilient despite faltering global growth. At 5 percent, the unemployment rate has remained steady for some time now prompting the Fed to declare that the share of job seekers per open position is currently the lowest since 2007.
The initial jobless claim for the week ending November, 20 is expected to come down to 270,000 from the previous 271,000. The continuous jobless claim for the week ending November, 13 on the other hand is expected to fall to 2.164 million from 2.175 million.
Unlike continued claims data which measures the number of persons claiming unemployment benefits, initial claims take into account new and emerging unemployment. Initial claim thus has a bigger impact on financial markets
Markit Composite PMI
The Markit Manufacturing PMI was released on 23rd November. The manufacturing sentiment in November fell to its lowest level in 25 months, according to the survey. The manufacturing PMI fell to 52.6 from 54.1 in October. The PMI moved closer to a more downbeat assessment by the Institute for Supply Management. Markets today will watch out for the Markit Services PMI as well as the Composite PMI. The Markit Services PMI is expected to have moved up from the previous 54.8 to 55.2.
New Home Sales
New home sales is expected to have moved up in October to 0.500 million from the previous reading of 0.468 million. Sales of existing houses on the hand at slipped 3.4 per cent to 5.55 million in September. The National Association of Realtors on 23rd November reported sales of existing homes ran at a seasonally adjusted annual rate of 5.36 million in October. Higher prices as well as tighter inventory are believed to have been straining the recovery of housing market.
It seems two contradictory forces are operating in the housing market. On one hand affordability, driven by tight supply, is restraining demand. On the other hand price rise is helping the housing market as existing homeowners can now trade up. Credit standards are also loosening a bit, offering more scope to other potential buyers.
(Market News Provided by FXstreet)