WEEKLY ANALYSIS – WEEKLY OUTLOOK
By Wyllian Capucci
02/28/2021 – Approval of the stimulus package at the congress, PMI week
Manufacturing / Services, Inflation in Europe and American Payroll. The RBA
update its monetary policy.
After President Biden’s $ 1.9 trillion pandemic aid bill was passed by
little in the Chamber at dawn on Saturday, all attention would now turn to the vote in the
Senate. In the meantime, investors will also look at the US jobs report, which will be
released on Friday; GDP data from Australia, Brazil, Canada and Turkey, as well as PMI surveys
manufacturing and services worldwide and monetary policy action by Reserve Bank of Australia.
COT report
COT ES: + 48.6k ; Total = -31,287 (Previous week: -8.4k ; Total = -79,861)
COT NQ: -26.5k ; Total = -5,388 (Previous week: -4,5k ; Total = 21,115)
EURO COT: -1.4k ; Total = 138,365 (Previous week: -216 ; Total = 140,006)
COT LIBRA: + 8.8k ; Total = 30,978 (Previous week: + 1,05k ; Total = 22,167)
COT DXY: +436 ; Total = -13,851 (Previous week: -412 ; Total = -14,287)
GOLD COT: -18.96k ; Total = 215,733 (Previous week: -16.44k ; Total = 234,696)
Profiles (Friday closing)
ES: Simple distribution
NQ: Long distribution in P pattern (with rejection at closing)
EURO: Short distribution in P pattern
LIBRA: Short distribution in L pattern
GOLD: Double Short distribution in P pattern, with slight rejection at closing.
Weekend HEADLINES:
– BIDEN $ 1.9TRI PANDEMIC STIMULUS DRAFT LAW APPROVED ON SATURDAY
RUG IN THE CHAMBER. ATTENTION IS NOW TURNING TO THE SENATE.
ECONOMIC CALENDAR (KEY EVENTS) – PREVIOUS WEEK
Highlights
– Powell: “We are still a long way from our goals. We will only squeeze the economy after
we reach full employment and inflation remains above 2% ”.
– Unemployment insurance: Decrease in the number of people seeking unemployment benefits through
first time, decreased in the last week, pulled by California and Ohio.
–
US durable goods orders up another month.
BALANCE SHEET CALENDAR
In the US, investor focus is on the February jobs report, which will provide a
view on the state of the labor market recovery. The non-agricultural payroll should
increase by 165 thousand, which would still leave the economy with about 10 million jobs lacking
jobs since the peak of February 2020; while the unemployment rate is expected to remain
unchanged at 6.3%, well above pre-pandemic levels of around 3.5%. Meanwhile, the
ISM PMI surveys are expected to signal strong manufacturing and service growth rates during
February, despite high levels of unemployment and lack of government support. Other publications
notable are external trade balance; factory orders; construction spending; Change of
ADP employment; Economic optimism of IBD / TIPP; and the final readings from the Markit PMIs and the
labor productivity in the fourth quarter.
In other parts of America, the following key figures include Canada’s GDP growth in the
quarter and current account, trade balance and PMI surveys from Markit and Richard Ivey School
of Business; Mexican business morale, gross fixed investment and PMI Markit Manufacturing; and the
GDP figures, industrial production, foreign trade and PMI Markit for the fourth quarter of Brazil.
Across the Atlantic, all eyes are on the UK Chancellor’s budget
Rishi Sunak, who is likely to reveal additional support measures for businesses and families
affected by the pandemic. In front of economic data, the main launches in Great Britain
include final Markit PMI data, Halifax and Nationwide housing price indices, sales of
new cars and monetary indicators from the Bank of England. The PMI flash survey signaled levels
stable levels of UK private sector production, helped by a smaller decline in
service sector activity and a resumption in the expansion of industrial production.
Elsewhere in Europe, investors will keep an eye on the final Markit PMI surveys for the
euro area, Germany and France, while Italy and Spain will publish their estimates
preliminary. In addition, the main inflation, unemployment and retail trade reports will be
launched for the eurozone and Germany, while several European countries will continue to update
GDP growth figures for the fourth quarter, including Italy and Turkey. Other data to follow
include: Euro Area producer prices; Factory orders in Germany; Trade balance
and France’s current account; Consumer prices and retail sales in Switzerland; and inflation data from
Holland, Turkey and Russia. Poland’s central bank will decide on interest rates.
In China, traders will turn their attention to the February PMI updates from NBS and
Caixin, with forecasts pointing to steady growth in manufacturing activity, as the
country continues to recover from the coronavirus crisis. In Japan, Jibun Bank will publish its PMIs
finals for February. Other important data for Japan includes consumer confidence, the rate of
unemployment and capital expenditures in the fourth quarter.
The Reserve Bank of Australia will hold its monetary policy meeting, but no change is
expected. With regard to economic data, the main data to be observed include GDP of the
fourth quarter, current account, Ai Group manufacturing, construction and services indexes, balance
building permits and housing loans. Elsewhere, the quick estimate
India for foreign trade and Markit PMIs will be highlighted.
Other highlights for the Asia-Pacific region include: final GDP reading for the fourth quarter of
South Korea, inflation, industrial production, retail sales, trade balance and manufacturing PMI
Markit; New Zealand building permits and foreign trade prices; Retail sale of
Hong Kong; Inflation rates for Thailand, Indonesia and the Philippines.
