US Cr Mkt Week Ahead: Dec Employ Report Unaffected By Shutdown

CHICAGO (MNI) - Shortened week ahead for New Years holiday, early close Monday

(Globex at 1315ET) and all day Tuesday (FI and FX markets resume trade on Globex

at 1700ET Tuesday).

In the event the U.S. government shutdown continues unabated, the Department of

Labor's funding had already been approved through September 2019 and the

Department itself and the Bureau of Labor Statistics are unaffected by the

partial shutdown. 

As a result, the release of the monthly employment report on January 4 will not

be impacted. Likewise, the release of initial jobless claims data on Thursday

will not be impacted.

Getting back to business in 2019, headline employment data upon return, ADP

private jobs data early Thursday in addition to Construction Spending and ISM

Manufacturing, Friday's December non-farm payrolls rounds out the week.

Fed-speak rounds out the week as Chairman Jerome Powell will participate in a

panel on monetary policy and central banking with Janet Yellen and Ben Bernanke

at the American Economic Association and Allied Social Science Association 2019

Annual Meeting in Atlanta, Georgia on Friday.

Upcoming U.S. Treasury auctions include 13W, 26W and 52W bills Monday, earlier

than usual due to shortened holiday session (see calendar below). Note auctions

resume in the following week with 3Y on Tuesday, January 8, 10Y on Wednesday,

January 9 and the 30Y bond on Thursday, January 10.

Salient data highlights (estimates):

- Monday: Markets close early for New Years eve; Dallas Fed manufacturing index

for December

- Tuesday: Markets closed for New Years holiday.

- Wednesday: Markets resume trade. Data includes Redbook retail sales; Markit

Mfg Index (final); Dallas Fed services index.

- Thursday: aside from North American-made light vehicle sales data throughout

the session, challenger layoff plans, Dec ADP private payrolls, weekly jobless

claims and November construction spending (0.4% est).

Nomura economists posit that incoming labor market data suggests "continued

strength in the labor market. We expect ADP to report a healthy reading in

private payroll employment during December, above the pace that is needed to

absorb new entrants."

- Friday: Nonfarm payrolls for December; unemployment rate (3.6% est); average

hourly earnings (0.3% est); Markit Services Index (final).

Morgan Stanley economists said they expect "net job growth of 167,000 in

December after a gain of 155,000 in November. We expect earnings to post a

strong 0.4% month-over-month gain, keeping the year-over-year rate steady at

3.1%. The unemployment rate should hold at 3.7%."

Calendar of next week's market events (prior, estimate):

31-Dec 1000 US TSY $39B 13W bill auction (912796RD3)

31-Dec 1000 US TSY $36B 26W bill auction (912796RW1)

31-Dec 1030 **  Dec Dallas Fed manufacturing index (17.6, --)

31-Dec 1130 US TSY $26B 52W bill auction (912796RT8)

31-Dec 1300 Markets close early (1315ET Globex close)

01-Jan Markets closed for New Years

02-Jan 0855 **  29-Dec Redbook retail sales m/m

02-Jan 0945 *** Dec    Markit Mfg Index (final) (53.9, --)

02-Jan 1030 **  Jan    Dallas Fed services index (11.4, --)

03-Jan  -   *** Dec    NA-made light vehicle sales SAAR (9.8m, --)

03-Jan 0700 **  28-Dec MBA Mortgage Applications

03-Jan 0730 *   Dec    challenger layoff plans (51.5%, --)

03-Jan 0815 *** Dec    ADP private payrolls (179k, --)

03-Jan 0830 **  29-Dec jobless claims (216k, --)

03-Jan 0945 *   Dec    ISM-NY current conditions (67.8, 57.5)

03-Jan 1000 *   Nov    construction spending (-0.1%, 0.4%)

03-Jan 1000 *** Dec    ISM Manufacturing Index (59.3, 58.1)

03-Jan 1630 **  02-Jan Fed weekly securities holdings

04-Jan 0830 *** Dec    nonfarm payrolls (155k, 180k)

04-Jan 0830 *** Dec    private payrolls (161k, 175k)

04-Jan 0830 *** Dec    unemployment rate (3.7%, 3.6%)

04-Jan 0830 *** Dec    average hourly earnings (0.2%, 0.3%)

04-Jan 0830 *** Dec    average workweek, all workers (34.4, 34.5hrs)

04-Jan 0945 *** Dec    Markit Services Index (final) (53.4, --)

04-Jan 1015 Atl Fed Pres Bostic, on long-run macroeconomic performance, American

Economic Assn and Allied Social Science Assn annual meet, Atl, GA, audience Q&A.

04-Jan 1015 Fed Chair Powell on to-be-annc'd topic re: mon/pol and central

banking, American Economic Assn, Atlanta, GA. Panel includes former Fed Chairs

Yellen and Bernanke.

04-Jan 1030 **  28-Dec natural gas stocks w/w

04-Jan 1100 **  28-Dec crude oil stocks ex. SPR w/w

04-Jan 1100 **  Q1     St. Louis Fed Real GDP Nowcast

04-Jan 1115 **  Q1     NY Fed GDP Nowcast

--MNI Chicago Bureau; tel: +1 312-431-0089; email: bill.sokolis@marketnews.com

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