May 2009 - Fed and Economy Watch

Gross Domestic Product ― the measure of total U.S. output of goods and services from ocean to ocean ― contracted at a slower pace in the first quarter than originally reported, the Commerce Department said on Friday. Looking ahead, the nationwide contraction appears to be slowing. The Q1 report indicated that output contracted by an annual rate of 5.7% rather than the -6.1% originally reported. Improvements were seen in construction, inventories, foreign trade, and government spending. However, analysts

Thursday will be a busy day with two key data releases an hour before the opening bell and another housing report half an hour into the session. There are also two energy-releases, multiple Treasury auctions, and once markets close Richard Fisher from the Dallas Federal Reserve will speak in Washington on the economic outlook. Prior to the data releases, investor sentiment looks set to pare some of Wednesday’s losses. S&P 500 futures are up 2.9 points to 895.4, Dow futures have climbed

The Conference Board’s measure of Consumer Confidence shattered expectations in May, surging beyond all forecasts to a score of 54.9, just more than 14 points higher than April’s upwardly revised 40.8. The score marks the highest level since September. Analysts were expecting a gain in the month due to the two-month rally in the stock market, but the consensus expectation was only 42.6, with the highest of expectations at 47. In reality, the jump was the biggest one-month climb in almost

Friday won’t see a single data release, but there’s plenty on the minds of investors as worries abound that the U.S. currency could lose its AAA-rating . In addition, two gloomy speeches from central bank officials Thursday evening brought the U.S. dollar down a notch overnight. Federal Reserve chairman Ben Bernanke speaks to graduates of Boston College Law School at 2pm, but there’s no Q&A. Judging by his graduation speech to Harvard last year, there’s little potential

The weekly survey of Jobless Claims failed to indicate any turnaround in the labor market on Thursday. Initial claims for unemployment benefits were more than expected, and those continuing to receive benefits once again jumped to an all-time high. This week is the survey week for Nonfarm Payrolls, meaning the report has implications for the official statistics released the first week of June. The Dept. of Labor said 631,000 people filed for first-time unemployment benefits in the week ending May

With no data releases scheduled for Wednesday morning, markets are likely to focus on earnings reports as well as the testimony of Treasury Secretary Tim Geithner. In the afternoon, the Federal Reserve will release minutes from the monetary policy meeting in late April. S&P futures look poised to open higher on Wednesday as crude oil futures bounced to a six-month high above $60 per barrel. Moreover, BJ’s Wholesale Club announced its earnings climbed 41% in the first quarter, suggesting

New economic data will be in short supply this week but the few releases that will be published do concern the housing market. Monday gives a look at homebuilder confidence, Tuesday gives data on new construction, and Thursday will show the survey week results for Jobless Claims. Further Details: The only bit of data to start the week is the 1pm release on homebuilder sentiment, published by the National Association of Home Builders. The monthly report is supposed to tick up to 16 this month, up

Industrial Production decreased by its slowest pace in six months in April, falling 0.5%, as expected, after a 1.7% contraction in March. Annually, total output has fallen 12.5%. Production in manufacturing fell 0.3% in the month, marking a 16.0% decline since its December peak. "One could say that the auto industry had its tire tracks all over the report, but it was not just cars," said Jennifer Lee, economist at BMO Capital Markets. "The weakness was widespread, from business equipment