At the beginning of May the unemployment rate data in the United States will be published, as well as non-farm payrolls with subsequent weekly applications for unemployment benefits. This will therefore be a week of key statistics from the US labour market.
In the last six weeks alone, 30 million Americans have applied for unemployment benefits. However, it is worth remembering that the data that will be published on Friday, 8 May, was collected until 12 April, so today the full picture may be much worse.
The market consensus assumes that the unemployment rate rose to 16 percent and 21 million jobs evaporated from the market. The scale of the phenomenon may therefore be enormous. However, unfortunately, this does not seem to be the end of the problems in the USA, and after the fatal first quarter, the second quarter may turn out to be even worse.
The first week of May may also bring the development of accusations against the Chinese authorities by the US President Donald Trump. The end of last week and the beginning of the current one brought about a fall in stock indices in the face of growing tensions between the US and China. Trump's administration blames the spread of coronavirus on China. U.S. Secretary of State Michael Pompeo said that there is evidence that the coronavirus outbreak began in a laboratory in Wuhan. In turn, the Chinese authorities did not react adequately to warn the world of a possible imminent disaster.
The resumption of the U.S. trade war with China would be a blow to both diplomacy and the economy, as well as to the performance of American companies. This is another possible risk factor that investors now have to take into account, so they may decide to sell out shares early this week.
Apart from labour market data, investors' attention may focus on final readings of PMI and ISM indices in the United States. The interest rates decisions will be published by the central banks of Australia and England. In both cases, however, no changes are currently expected. In Australia, the main interest rate may remain at the level of 0.25 percent, and in the UK at the level of 0.1 percent.
Daniel Kostecki, Chief Analyst Conotoxia Ltd.
Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.
66% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Trade this news from Conotoxia Ltd. platforms
Go to your account
