Economic Data and Earnings: Prepare for a Busy Week

This week in Economic Data and Earnings, Wall Street will have a busy schedule with tech companies such as Alphabet, Apple, Amazon, and Facebook parent company Meta releasing their fourth-quarter earnings result, while the Federal Reserve will hold its first meeting of the year to announce its rate decision. The Federal Reserve is expected to raise interest rates by 0.25% and Fed Chair Jerome Powell’s press conference will give investors insight into the central bank’s future plans.

Additionally, the monthly jobs report for January will be released on Friday. Analysts expect that 185,000 jobs will be added to the economy last month. Although fourth quarter earnings season has been modestly disappointing, the market’s performance this year suggests investors are not surprised. Companies such as Qualcomm, Ford, Advanced Micro Devices, and Caterpillar will also report results. Besides the jobs report, other economic data such as manufacturing readouts and consumer confidence will be closely monitored. The private payrolls data from ADP and the weekly report on initial jobless claims will also be significant leading up to the nonfarm payrolls report.

The earnings season is still largely a disappointment, with only 69% of the S&P 500 companies that have reported so far beating earnings per share expectations, lower than the average of 77% in the last 5 years and 73% in the last 10 years, according to FactSet data. This week’s big tech companies, including Alphabet, Apple, Amazon, and Facebook’s parent company, Meta, will report their 4th quarter financial results. Their results will be closely watched by investors, who will look for information on factors such as softening consumer discretionary spending and slowing growth for Amazon’s cloud business, AWS, and momentum on iPhone demand for Apple.

Besides earnings, the Federal Reserve’s first meeting and rate decision of 2023, which is expected to result in a 0.25% rate hike, and the monthly jobs report for January, which is expected to show 185,000 jobs added to the economy, will also be important events this week. Other key economic data releases, including manufacturing readouts, consumer confidence, private payrolls data, and jobless claims, will also be closely watched.

Economic Data and Earnings

Monday Earnings and Economic Reports

On Monday, there are a few key events taking place in the financial world. Firstly, the Dallas Federal Reserve will release its January manufacturing activity report. The expectation for the report is a negative 15.0, which would indicate a contraction in the manufacturing sector, but an improvement from the prior month’s reading of negative 18.8. Additionally, several companies are set to report their earnings on Monday, including Alexandria Real Estate Equities, GE HealthCare, Helmerich & Payne, J&J Snack Foods, Philips, SoFi Technologies, and Whirlpool. Investors and market analysts will be closely watching these earnings reports for insight into the financial performance of these companies.

Tuesday Earnings and Economic Reports

On Tuesday, there is a batch of economic data and earnings reports being released. In terms of economic indicators, the Employment Cost Index, the FHFA Housing Pricing Index, and the S&P CoreLogic Case-Shiller 20-City Composite will be published. The Conference Board Consumer Confidence and Present Situation, as well as the MNI Chicago PMI, will also be released. These data points are expected to give insights into the health of the economy and the housing market.

In terms of earnings, a number of big names will report, including Advanced Micro Devices, Amgen, Boston Properties, Caterpillar, Exxon Mobil, General Motors, McDonald’s, Pfizer, Phillips 66, and UPS, among others. These reports will be closely watched by investors to see how these companies performed in the previous quarter and to get a sense of their outlook for the future.

Wednesday Earnings and Economic Reports

On Wednesday, several key economic indicators are scheduled to be released. The MBA Mortgage Applications will show the change in the number of applications for mortgages in the US in the week ended January 27, while the ADP Employment Change will provide data on the change in employment in January. The S&P Global U.S. Manufacturing PMI will also be released, which provides a measure of the country’s manufacturing activity. Meanwhile, the Construction Spending report will show the change in spending on construction projects in December, while the ISM Manufacturing report will indicate the state of the manufacturing sector. Additionally, the Federal Reserve is set to announce its FOMC Rate Decision, which will provide information on the target range for the federal funds rate, and the Interest on Reserve Balances Rate, which shows the rate that banks are paid for their excess reserve balances held at the Federal Reserve. Finally, the WARDS Total Vehicle Sales will provide data on the total number of vehicles sold in November.

On Wednesday, a number of companies are set to announce their earnings, including Meta Platforms, Aflac, Allstate, Boston Scientific, e.l.f. Beauty, eBay, Evercore, Humana, McKesson, Meritage Homes, MetLife, Novartis, Old Dominion, Peloton Interactive, Thermo Fisher Scientific, and Waste Management.

Thursday Earnings and Economic Reports

On Thursday, various economic indicators and corporate earnings will be released. In terms of the economic indicators, the Challenger Job Cuts report for January is expected to show a 129.1% increase from the previous month, while the Unit Labor Costs report for Q4 is expected to be 1.5%. The Nonfarm Productivity report for Q4 is expected to be 2.5% and the Initial Jobless Claims for the week ended Jan. 28 is expected to be 200,000. Other reports including Factory Orders, Durable Goods Orders, and Non-defense Capital Goods Orders will also be released on Thursday.

In terms of corporate earnings, a large number of companies, including Apple, Amazon, Bristol-Myers Squibb, Ford, Gilead Sciences, Hershey Foods, Merck, and Starbucks, will be releasing their results.

Friday Earnings and Economic Reports

On Friday, there will be several important economic releases and earnings reports. In terms of the economic releases, there will be data on the change in payrolls for January, including nonfarm payrolls, private payrolls, and manufacturing payrolls. Additionally, there will be information on the unemployment rate, average hourly earnings, and the labor force participation rate. Also, there will be final data on the S&P Global U.S. Services PMI and the S&P Global U.S. Composite PMI. In terms of earnings reports, companies such as Aon, Cboe Global Markets, Cigna, and Regeneron Pharmaceuticals will release their financial results.

ConclusionThis week is going to be a busy one on Wall Street with tech giants like Alphabet, Amazon, Apple and Facebook’s parent company Meta releasing their fourth quarter financial results. Additionally, the Federal Reserve’s first meeting of the year to announce its rate decision is expected to result in a 0.25% rate hike. The market’s performance so far suggests that investors are not too concerned with the modestly disappointing earnings season so far, with only 69% of the S&P 500 companies beating earnings per share expectations, lower than the average of the last five years. The jobs report for January is expected to show 185,000 jobs added to the economy, which along with other economic data releases will also be closely monitored. There are also several key events taking place each day of the week, including earnings releases from various big names, and economic data releases from the Federal Reserve and MBA Mortgage Applications, among others.

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