The Week on Wall Street
Stocks advanced four days out of five during the past
market week, erasing the losses of the week before.
The Nasdaq Composite surged 4.04%, the
S&P 500 3.17%, and the Dow Jones Industrial Average 3.00%. Foreign stocks also rallied: the MSCI
EAFE index added 2.21%.[1][2]
China Plans to Halve Some Tariffs
Thursday, investors woke up to the news that
China would be lowering import taxes on about $75 billion of U.S. products. Later this week, a set of
10% tariffs is slated to drop to 5%, and a group of 5% tariffs is scheduled to fall to
2.5%.
This reduction is part of the phase-one trade deal that China agreed to last month, a
pact which may be a step toward a trade truce with the U.S.[3]
January's
Net Job Gain: 225,000
The Department of Labor's latest employment report exceeded
expectations. Economists surveyed by Bloomberg projected 165,000 net new hires last month. The main
jobless rate ticked north to 3.6%; the U-6 rate including the underemployed rose 0.2% to
6.9%.
This upside surprise points to ongoing strength in the economy. Stocks declined
Friday after the report's release, however, as traders viewing the data saw less reason for a Federal
Reserve rate cut in the near future.[4]
A Manufacturing
Positive
The U.S. factory sector grew last month, for the first time since July. The
Institute for Supply Management's purchasing managers index for the manufacturing sector, which
traders view as a fundamental economic indicator, came in at 50.9 in January; any reading above 50
indicates sector expansion.[5]
What's Ahead
Investors
should note that U.S. stock and bond markets will be closed on Monday, February 17 for Presidents
Day.
THE WEEK AHEAD: KEY ECONOMIC DATA
Tuesday:
Federal Reserve chairman Jerome Powell begins two days of testimony in Congress on U.S. monetary
policy.
Thursday: The federal government's January Consumer Price Index,
measuring monthly and yearly inflation.
Friday: January retail sales data from
the Census Bureau, and the University of Michigan's preliminary February consumer sentiment index, an
evaluation of consumer confidence levels.
Source: MarketWatch, February 7,
2020
The MarketWatch economic calendar lists upcoming U.S. economic data releases
(including key economic indicators), Federal Reserve policy meetings, and speaking engagements of
Federal Reserve officials. The content is developed from sources believed to be providing accurate
information. The forecasts or forward-looking statements are based on assumptions and may not
materialize. The forecasts also are subject to revision.
THE WEEK AHEAD:
COMPANIES REPORTING EARNINGS
Monday: Allergan (AGN), RingCentral
(RNG)
Tuesday: Exelon (EXC), Hilton Worldwide Holdings
(HLT)
Wednesday: CME Group (CME), Cisco (CSCO), CVS Health (CVS), Shopify
(SHOP)
Thursday: Alibaba (BABA), Nvidia (NVDA), PepsiCo
(PEP)
Friday: AstraZeneca (ABBV), Enbridge (ENB)
Source: Zacks,
February 7, 2020
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