Weekly Reports | Oct 01 2010
By Greg Peel
Today is global manufacturing PMI day, meaning this morning we will see the release of the Australian PMI, by noon we should have China, then the UK, EU and US will follow this evening.
Australia's manufacturing industry takes a significant back seat to commodity exports as a factor of GDP and it has been struggling to reach expansion territory of late. A plus 50 result would be more grist for the rate hike mill. HSBC has already provided its take on China's PMI, which was a pull back from the brink of contraction further cementing the “soft landing” story on China.
The UK and eurozone have managed to maintain PMIs sufficiently over 50 in recent times which just leaves the US, which has also remained over 50 including a big upward surprise in August. But a strong US PMI would mean stock market strength and a weak PMI would stir up the Fed which would imply stock market strength.
How long this artificial win-win formula can be maintained is anyone's guess.
Aside from the manufacturing PMI, the US sees private income and expenditure tonight, along with vehicle sales and the fortnightly Michigan Uni consumer sentiment measure.
Next week in the US is employment week, culminating in the official non-farm payrolls number on the Friday. The ADP private sector unemployment number is released on the Wednesday, and next week also brings factory orders, pending home sales, chain store sales and consumer credit.
Services sector PMIs are also released next week by Australia, the UK, EU and US.
It's Chinese National Day today, celebrating the formation of the PRC in 1949. This heralds in a week of holidays next week through to Thursday and Chinese markets will be closed over the period.
Australia will go on to Daylight Savings time in the appropriate states this weekend. Monday is a long weekend in NSW, ACT and South Australia and while the ASX will be open, traditionally it's a dead quiet day with little market activity or research generated.
Thereafter economic releases include the ANZ job ads series, and the NAB business conditions and confidence survey along with unemployment on the Thursday. On Tuesday the RBA will make its rate decision which at this stage has become pretty 50/50 in terms of whether we will go up to 4.75%.
On the local stock front, October is the big month for Annual General Meetings, which build up through the month and culminate with a big burst in the final week.
Please note that as of Tuesday morning the NYSE will close at 7am Sydney time instead of 6am.
For a more comprehensive preview of next week's events, please refer to "The Monday Report", published each Monday morning. For all economic data release dates, ex-div dates and times and other relevant information, please refer to the FNArena Calendar.
