There are five U.S. Federal Reserve (Fed) speakers scheduled this week, and they will get more attention than usual. Last week’s Fed statement said, “The unemployment rate remains low, and labor market conditions remain solid.” Two days later, the July employment report was very weak with large downward revisions to previous months. The markets would like some clarification on the Fed’s forecast. Michelle W. Bowman, one of the scheduled speakers, dissented with the decision to leave rates unchanged, instead voting for an immediate 25-basis-point cut.
The earnings season will continue with approximately 30 of the S&P 500 members reporting, including AMD, Caterpillar, McDonald’s, Lilly, and Walt Disney. Earnings have been better than expected, with 82% of companies reporting positive surprises.
The data calendar is light after a busy week last week. It is highlighted by the Institute for Supply Management (ISM) Services index and factory orders. Factory orders ex-transportation is forecast up 0.2%, and the ISM survey is expected to show continued expansion on the service side of the economy.
Three Things to Know
At the July Fed meeting, two voting members dissented with the majority opinion for the first time since 1993. (Source: Benjamin F. Edwards)
Included in the July employment report were revisions lower to the previous two months. Almost 260,000 disappeared from the rolls, or the population of Scottsdale, Ariz. (Source: Bloomberg)
Robert Liston (1794-1847) was a Scottish surgeon who is most famous for amputating a patient’s leg in under 2.5 minutes, operating so quickly that in the process also amputated the fingers of his assistant and slashed the coattails of a spectator, who dropped dead from sheer terror. The patient and his assistant later died from gangrene, making it the only recorded operation with a 300% mortality rate. (Source: @fascinate)
