Robust economic data, the prospect of interest rate cuts in the United States and acceptable quarterly figures from NVIDIA gave the US stock markets a strong boost in the past trading week. With the publication of new US jobs data, the focus in the coming days is likely to once again be on US monetary policy.
50 basis point move for September meeting remains possible - interest rate outlook uncertain
The CME Group's "Fed Watch Tool" currently signals the chance of a rate cut of 50 basis points at the upcoming September meeting (September 18) to 30 percent, down from 36 percent a week ago. The probability of a rate cut of a quarter of a percentage point is 70 percent.
Even though Fed Chairman Jerome Powell signaled a turnaround in interest rates at the most recent central bankers' meeting in Jackson Hole, the question marks over further interest rate hikes remain. Moreover, the market is likely to have more or less priced in an interest rate turnaround in a few weeks' time.
Economic data and "Beige Book" in the first half of the week as possible drivers
While Monday will see fewer relevant impulse generators, Tuesday should be exciting with new purchasing managers from S&P Global for the manufacturing sector (15:45).
However, the ISM index for this sector should be of even higher priority from 16:00. Economists are expecting a month-on-month increase of one point to 47.8 units.
On Wednesday, investors will focus on the so-called "Beige Book" (20:00), which provides an overview of the current economic situation in the USA.
ADP data gives first taste of non-farm payrolls
The ADP data from the service provider Automatic Data Processing on Thursday (14:15) usually give a first taste of the official US labor market report.
In addition to the weekly initial claims for US unemployment benefits (14:30), the ISM data for the services sector (16:00) is also likely to be tapped for economic clues. A slight increase of 0.1 points to 51.5 points is expected.
US jobs data could brighten significantly - another disappointment not ruled out
On Friday, however, the US labor market data (non-farm payrolls) is expected to be published at 2:30 p.m., which investors are likely to put on the gold scale, especially after last month's meagre jobs report.
Experts expect an increase in jobs of 163,000 units, following 114,000 new jobs in the previous month. In this context, the unemployment rate could fall by 0.1 percentage points from 4.3% recently.
On the inflation side, however, the development of average hourly wages could make people sit up and take notice. An increase of 0.3% is expected, after 0.2% in the previous month (month-on-month comparison).
