Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


World Week Ahead: Yellen testimony follows weak US jobs news

World Week Ahead: Yellen testimony follows weak US jobs news

Feb 10 (BusinessDesk) – Janet Yellen is scheduled to deliver her first testimony as chairman of the Federal Reserve to US lawmakers this week after a weaker-than-expected jobs report did little to temper investors’ optimism about the US economic outlook.

In the past five days, the Dow Jones Industrial Average gained 0.6 percent, while the Standard & Poor’s 500 Index climbed 0.8 percent, and the Nasdaq Composite Index rose 0.5 percent.

On Friday Wall Street jumped, lifting the Dow 1.1 percent, the S&P 500 1.3 percent, and the Nasdaq 1.7 percent. Investors were undeterred by a government report showing payrolls increased by 113,000 in January, the second month in a row that the number fell far short of economists’ expectations. The unemployment rate unexpectedly slid to 6.6 percent.

“Folks like me are looking through the headline miss and recognising and appreciating that there was some weather factor, but the underlying strength is still there,” Phil Orlando, New York-based chief equity market strategist at Federated, told Bloomberg News. Severe winter weather disrupted activity across northern states last month.

Indeed, US Treasuries declined for the week, pushing the yield on the 10-year bond four basis points higher to 2.68 percent.

Even so, the weak US jobs data heightened the interest in Yellen’s semi-annual testimony to the House Financial Services Committee on Tuesday and the Senate Banking Committee on Thursday.

"We'll all be trying to get a sense of how the Fed is reading recent developments," Carl Tannenbaum, chief economist at Chicago-based Northern Trust, told Reuters. "We have had some news that while it is almost certainly affected by the weather, it has not been robust."

The Fed last month said it would cut its monthly bond-buying programme by another US$10 billion, reducing it to US$65 billion, as had been widely expected.

Other Fed officials are also scheduled to speak in the coming days. On Tuesday, Philadelphia Fed President Charles Plosser will talk on the economic outlook in Newark, Delaware; Richmond Fed President Jeffrey Lacker will speak on financial stability at Stanford University, while Dallas Fed President Richard Fisher will also discuss the economic outlook, in Dallas, as will St Louis Fed President James Bullard in New York on Wednesday.

The latest data on the US economy will arrive in the form of the NFIB small business optimism index, due Tuesday; Atlanta Fed business inflation expectations, due Wednesday; weekly jobless claims, retail sales, and business inventories, due Thursday; and import and export prices, industrial production, and consumer sentiment, due Friday.

The most recent US earnings provided a mixed bag last week. In investors’ good books was Expedia, with shares soaring 14 percent on Friday, while LinkedIn disappointed, sending its stock down 6 percent.

The coming days will offer earnings of Sprint, Deere, Cisco, and Pepsi.

About two-thirds of S&P 500 companies have posted quarterly earnings this season, with 76 percent beating profit estimates and 66 percent exceeding sales projections, data compiled by Bloomberg show.

In Europe, the Stoxx 600 Index added 0.8 percent last week. The UK’s FTSE 100 climbed 0.9 percent, while France’s CAC 40 rose 1.5 percent. Germany’s DAX slipped 0.1 percent.

On Wednesday, the Bank of England is scheduled to publish its quarterly economic outlook.

Economic reports due in the coming days include euro zone industrial production, on Wednesday, German CPI, on Thursday, and euro zone GDP, on Friday.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Speaking For The Bees: Greens Call For Neonicotinoid Pesticide Ban

The National Government should ban the use of controversial pesticides called neonicotinoids after evidence has revealed that even at low doses they cause harm to bee populations, the Green Party said today. More>>


Science Awards: NZAS Celebrate NZ Scientific Achievements

The Marsden Medal is awarded for a lifetime of outstanding service to the cause or profession of science, in recognition of service rendered to the cause or profession of science in the widest connotation of the phrase. This year’s medal is awarded to Dr Mike Andrews. More>>


Court Rules: Affco 'Unlawfully' Locked Out Meat Workers

The note says the full court found for the plaintiffs, "that is that the defendant locked out the second plaintiffs unlawfully and that it breached s 32 of the Act by acting otherwise than in good faith towards the plaintiffs while collective bargaining was still going on." More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news