Oct 6, 2016
With the third quarter ending last week, Q3 earnings season is right around the corner. For investors, there is some optimism that the current quarter will show better overall growth than we have recently seen. We have always considered earnings season to be the period covering earnings reports starting with Alcoa (AA) and ending with Wal-Mart (WMT). Although AA is far from the industrial powerhouse that it used to be and is in the process of splitting up, most companies report in this window, so we use these two companies as our rough start and end dates for the coming earnings season.
The real heart of earnings season doesn’t begin for a couple more weeks, and the peak reporting day for this earnings season is not until 10/27 when more than 60 companies in the S&P 500 will report. Outside of AA on 10/11, the only other real major reports next week are CSX on 10/12, Wynn Resorts (WYNN) on Thursday, and then several banks including Citigroup (C), JP Morgan (JPM), PNC, and Wells Fargo (WFC) on Friday. For a more detailed rundown of the earnings schedule for the upcoming season, please see our Interactive Earnings Calendar.
As we do each quarter, we just posted our quarterly preview of the coming earnings season based on trends in analyst revisions for the market as a whole and individual sectors. For anyone who trades in the market on a regular basis, this report is a must read. To view it, sign up for a monthly Bespoke Premium membership and get 10% off for life ($89/month).
Oct 6, 2016
Tomorrow morning’s release of the September Non Farm Payrolls report will go a long way in determining when (and if) the FOMC will ultimately bite the bullet and hike rates again. As it stands now, economists are currently expecting an increase in payrolls of 172K, which would be a 21K increase from last month’s weaker than expected reading of 151K. In the private sector, economists are expecting an increase of 170K, which would be an even larger improvement than the increase in the overall headline reading. The unemployment rate is forecasted to remain at 4.9%. Growth in average hourly earnings is expected to accelerate back up to 0.3%, while hours worked is forecast to increase to 34.4 from 34.3. August’s employment report was a negative surprise for the market and kicked off what was essentially a steady stream of weaker than expected August data. Data for September has so far shown signs of a rebound, so we’d look for some strength in Friday’s report as well.
With such high stakes surrounding the report, the market will likely have a big reaction to the upside or downside based on how the number comes in relative to expectations. To that end, last night we published our eleven-page monthly preview for the September jobs report. This report contains a ton of analysis related to how the equity market has historically reacted to the monthly jobs report, as well as how secondary employment-related indicators we track looked in September. We also include a breakdown of how the initial reading for September typically comes in relative to expectations and how that ranks versus other months.
For anyone with more than a passing interest in how equities are impacted by economic data, this report is a must read. To see the report, sign up for a monthly Bespoke Premium membership and get 10% off for life ($89/month).
