MarketDeal24.Com – This week is going to remain slack in nature when it comes to trading volume. As this week is characterized by featuring New Year’s Eve, which is something pushing those volumes to remain light in nature which in turn is reducing liquidity in the market and increasing the volatility of trading.
Financial Markets across the globe are going to have their eye fixed on coming Friday’s Federal Reserve’s December policy meeting, the last one of 2019, which will disseminate some hints about the future trajectory of monetary policy to be adopted by this central bank.
Another attention grabbing feature of this week is its being full of economic reports coming out public. The US is, of course, is the undisputed leader in releasing these data, which will be making public its report on manufacturing activity and consumer confidence indices. These will provide investors with more clues about the true health of the globe’s largest economy.
China is no different from the United States when it comes to releasing economic data. Same as the US, China will be making public its official handout on the country’s manufacturing activity. Unnerved investors across the globe are holding their breath to have some positive vibes from the second-largest economy of the globe.
Ahead of the coming week MarketDeal24, your most trusted partner in the market, has compiled a list of five very important events, it believes, are going to shape the outlook for this week. An investor is required to keep himself abreast about these if he or she wants to survive the market.
Global Markets to Celebrate New Year’s Day
Financial markets located across the globe i.e. the US, UK, Europe, Switzerland, Japan, Australia, New Zealand, are going to remain closed in observance of the arrival of the new year on New Year’s day. This time of the year, which commemorates Christian religious tradition of Jesus Christ’s birth on Christmas day is said to have given short-term boost to the markets which is dubbed as “Santa Claus Rally.”
As per a historic data tracking the performance of the S&P 500 index since 1950, the data reads as, the last five days of the outgoing year and the first two days of the new year shows a 1.3% gain in value on an average.
FOMC Meeting Minutes
The central banking agency of the United States of America, Federal Reserve System is going to release the minutes of its last monetary policy fixing meeting. It will come to public domain on Friday, 2:00 PM Eastern Time (ET).
Federal Reserve in its last meeting on December 11 decided to hold the lending rate steady, signaling that the benchmark rate is going to remain that way for some time to come. Rumors circulating in the market is pointing out towards some sort of certainty from the Fed policymakers. The rumor reads 13 of the 17 policy makers of Fed believe that the interest rate will remain unchanged until 2021.
ISM Manufacturing Producers’ Index of the US
United States based Institute of Supply Management (ISM) is going to make its flagship monthly sensation public once again of December’s data on its manufacturing survey. Market insiders are pointing towards a reading of 49.0 from 48.1 in October.
It better be noted here, that 50 point mark is the dividing line between contraction and expansion. Anything above 50.0 points towards expansion and below that contraction.
The significance of Purchasing Managers’ Index (PMI) is such that certain quarter of economists prefer it over the reading of gross domestic product, which might be affected by poor seasonal variations and frequent revisions.
Consumer Confidence Index by the US Consumer Board
In addition to the manufacturing activity report, another piece of sensation is coming out this week too. And that is Consumer Confidence Index report by the US Consumer Board. It will be made public on Tuesday, 10:00 AM Eastern Time (ET).
Experts are forecasting a reading of 128.2 points, improving from 125.5 points in October. If it’s really this then it confirms being the best reading in the last three months.
Chinese Manufacturing Survey
China, the second-largest economy of the globe and another party in the prolonged trade spat with the United States, is also rivaling the US when it comes to making it manufacturing activity report card public.
The China Federation of Logistics and Purchasing is going to release a report on the country’s manufacturing sector’s activities for the last month of 2019. Market is hoping for a reading of 50.1 points from a reading 50.2 points in October.
The Caixin MAnufacturing Index, which is oriented more towards small and medium enterprises or SMEs, is going to release its flagship report on Thursday 01:45 GMT. Experts are hoping for a reading of a dip of 0.1 points to 57.1 points.
Under spectacular pressure created by a dwindling domestic consumer demand and crushing tariff war with the United States, China’s economy lost momentum of the old days, the first time in the last three decades. Which is prompting its government to roll out more stimulus to pump up the economy.