Wednesday is a busy day for markets with the release of top-tier economic data, including ADP employment, the ISM non-manufacturing report for November and the Fed's Beige Book.
Ray Stone, analyst from Stone and McCarthy, said he is expecting the ISM non-manufacturing survey to have more impact than the ADP employment data. He added that both reports will highlight the faltering U.S. economy.
"The direction of the statistics appears to remain very much on the downside," he said. "These are difficult times, and the light at the end of the tunnel seems very far away."
Traders and investors will turn to the ADP employment report for a glimpse of Friday's official payrolls numbers. Economists are expecting the ADP report to show a decline of 205,000 jobs in November following a 157,000 loss in October.
George Androulidakis, director of FX trading at the National Bank of Canada, said most traders are waiting for Friday's official employment numbers.
Another major report will be the ISM non-manufacturing survey, which economists expect to continue to weaken to 42.0, down from October's reading of 44.4.
Mike Englund, chief economist from Action Economics, isn't very optimistic about tomorrow's survey. He will be watching the employment component of the survey for signs of risks in Friday's nonfarm payrolls report.
"All the major producer sentiment measures have shown a very weak (November) performance, yet the ISM-NMI is closely correlated with the service components of the jobs report, which will be an important driver for Friday's risks," he said.
Finally in the afternoon, the Fed will release the Beige Book.
All times in EST:
7:00 US MBA Mortgage Applications W/E November 28 Prior: 1.5%
7:30 US Challenger Job Cuts (Y/Y) November Prior: 78.9%
8:15 US ADP Employment Change November Exp: -205K Prior: -157K
8:30 US Nonfarm Productivity 3Q Final Exp: +0.9% Prior: +1.1%
8:30 US Unit Labor Costs 3Q Final Exp: +3.6% Prior: +3.6%
10:00 US ISM Non-Manufacturing Composite November 42.0 Prior: 44.4
10:15 US Fed Governor Randall Kroszner Speaks at Policy Forum on Poverty in Washington
10:35 US DOE U.S. Refinery Utilization W/E November 28 Exp: 0.20% Prior: +1.25%
10:35 US DOE U.S. Distillate Inventory W/E November 28 Exp: +400K Prior: -147K
10:35 US DOE U.S. Gasoline Inventories W/E November 28 Exp: +1000K Prior: +1842K
10:35 US DOE U.S. Crude Oil Inventories W/E November 28 Exp: +1200K Prior: +7280K
12:00 CA BOC to sell $600 million in 33-year Real Return bonds
12:30 US Richmond Fed President Jeffrey Lacker, Bank of America CEO Kenneth Lewis and Wachovia CEO Robert Steel Speak on Economy at an event in Charlotte, North Carolina
14:00 US Fed Releases Beige Book Economic Report
December 03-09 US Mortgage Delinquencies Q3 Prior: 6.41%
By Neils Christensen and edited by Nancy Girgis
©CEP News Ltd. 2008