Wednesday, July 6, 2011
This is Mark Vickery, editor at Zacks.com, covering Ahead of Wall Street from Sheraz Mian while he is away this week.
While the ADP (ADP) employment report for June has been pushed back from today, Wednesday the 6th to Thursday the 7th, investors will need to cool their heels before trading on economic sentiment based on employment numbers. This Friday, the Bureau of Labor Statistics (BLS) is scheduled to release its non-farm payroll report, but the ADP numbers temper expectations in the market, as ADP is the largest private-sector payroll processor.
We also expect the ISM Services Index to release its monthly report today. Expectations are that services will dip somewhat but remain above the "magic 50" reading that designates growth or contraction.
Elsewhere, market futures had already been down after yesterday afternoon’s downgrade of Portugal to junk status by Moody’s (MCO). Portuguese stocks are down 2.6% before the opening bell this morning, This has kept European banks trading weaker today, and keeps questions about the economic health of the EuroZone front and center.
Also, China has again raised lending rates — for the third time this year — by 0.25 points to 6.56%. This is a clear indication that China still sees taming inflation in the country as a top priority, even as economic growth there has simmered down.
The Mortgage Bankers Association (MBA) reported 5.2% lower mortgage application activity last week. Interest rates coming up was the main reason cited. Finally, Challenger, Gray & Christmas — a top outplacement consulting firm — said the number of planned job cuts rose to 41,432 in June, up 11.6% month over month.
Mark Vickery
Editor – Zacks.com
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