In Europe, the FTSE 100 index of leading British shares was down 0.1 percent, while Germany’s DAX was little changed. The CAC 40 in France was 0.2 percent higher.
US stock futures were lower on Friday after Spain’s prime minister said his country will miss its deficit targets this year.
In currency markets the euro fetched $1.3275 and 108.38 yen in Tokyo afternoon trade, compared with $1.3311 and 107.97 yen in New York. Gold was at $1,714.50 an ounce, compared with $1,717.20 late Thursday.
The first full week of March sees the release of the employment data on Friday, but before then there will be relatively little data of importance. The timing of the BLS survey means that many of the more compelling headlines -- such as the ISM manufacturing index
-- were released in the prior week.
To fill in for the lack of economic data, markets will have an abundance of routine monetary policy statements on the calendar from major central banks. What they will not have is a lot of fresh input from Fed policymakers. The traditional press blackout period in advance of an FOMC meeting starts on Tuesday.
Note: the switchover to daylight saving time in the U.S. takes place on Sunday, March 10.
Economic Data
The data calendar is fairly sparse in the March 5 week, and the focus will be on the release Friday of the February numbers for employment at 8:30 ET. At this time markets surveys point to a trend-like gain of 200,000 or so. There appear to be few special factors likely to impact the data. The January payroll gain in manufacturing that was due to an extended production period at automakers should give way to a slower rise in jobs at factories in February. Adverse weather was absent in much of the country. If any weather impacts are anticipated, it may prove that construction was more active this winter than usual. Initial claims data point to some further modest taking up of the slack in the labor market, and as a result, the unemployment rate could improve a bit from the 8.3% in January.
Markets will have an eye on the ADP National Employment Report at 8:15 ET on Wednesday. The numbers have missed the size of the payroll change by a fairly substantial amount in the last few months. The reports were under the BLS counts in January, and over the counts in December and November. Nonetheless, it has consistently pointed to solid gains in private payrolls for the last six months and it is hoped that February will extend that run.
The Challenger report on layoff intentions in February at 7:30 ET on Thursday should confirm that the pace of layoff announcements remains low in an historical context, and that most sectors are experiencing only scattered activity. The exceptions are in government where budget constraints continue to exert pressure to reduce payrolls, and finance where banks are restructuring based on new regulations.
Initial jobless claims for the week ended March 3 at 8:30 ET on Thursday will not have any significance for expectations for the payroll report since it will be past the survey comparison period and probably will not have any revisions to the relevant week. However, any sign that new filings for benefits are stable -- or falling -- will confirm a brighter outlook for jobs. Current levels are hovering around the mid-350,000s, and are closer to readings seen before the recession began to seriously impact the labor market.
The ISM Non-Manufacturing Index for February at 10:00 ET on Monday is likely to reflect the surge in gasoline prices. While overall activity is expected to expand at a moderate pace, higher gasoline prices usually mean less demand for services, and higher costs to service providers which in turn means less investment back into the business and less new hiring.
New orders for factory goods in January at 10:00 ET on Monday should also see some influence from energy prices. Orders for durable goods in January were already reported down 4.0%, in part on declines in civilian aircraft orders. However, nondurables will probably rise due to higher petroleum costs.
The revised data for fourth quarter productivity and costs is set for 8:30 ET on Wednesday. It should follow the lead of the second estimate of GDP of 3.0%, which was revised slightly higher, and therefore should show increased productivity.
The next round of data that will feed into expectations for the third estimate of fourth quarter GDP will be released on Friday. The international trade data for January will be released at 8:30 ET, and the wholesale trade figures for January will be out at 10:00 ET. These will offer revised numbers for December, but at this point the first quarter 2012 is already well advanced. Analysts will be looking for at the direction of growth in the estimates for the preliminary report on GDP in the first quarter. The third and final estimate for fourth quarter GDP will be released on Thursday, March 29 at 8:30 ET.
Consumer credit for January at 15:00 ET on Wednesday should reflect the solid sales for automobiles in non-revolving credit. Revolving credit is likely to be less used after the holiday shopping period ended, and consumers turned more cautious.
Central Bank Activity
Most major central banks will make routine monetary policy announcements in the first two full weeks of March. There is little expectation that any of them will change their respective benchmark rates, or that there will be further unconventional easing measures at this time. Global financial markets appear to have stabilized for now, and for the moment conditions do not appear to be worsening in the euro zone.
Next week the Reserve Bank of Australia will release its statement in the overnight hours of Monday-Tuesday. The Reserve Bank of New Zealand will release its decision in the overnight hours of Wednesday-Thursday.
The Bank of England's Monetary Policy Committee meets on Wednesday and Thursday and will publish its decision at 7:00 ET on Thursday. The Governors of the ECB will meet on Thursday and announce its decision at 7:45 ET on Thursday. The Bank of Canada will also release its scheduled statement at 9:00 ET on Thursday.
In the following week, the Bank of Japan Policy Board will meet on Monday and Tuesday, and the outcome will be announced in the overnight hours of Tuesday-Wednesday. The Federal Reserve's FOMC will meet in a one-day session on Tuesday, with the post-meeting statement expected at 14:15 on Tuesday. There will be no update to the FOMC's forecast or press briefing by the Chairman.
U.S. Treasury Auctions
On Thursday, the Treasury will announce the second leg of the quarterly refunding with new 3-year notes, and reopenings of the 10-year notes and 30-year bonds. These will auction on the following Monday through Wednesday, respectively. Usually the Treasury would auction these on Tuesday through Thursday, but in order to allow them to settle on the 15th, the schedule was moved up a day.
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