Weekly Economic Indicators: Impact of Hurricane Sandy

Hurricane Sandy _Staten Island

Hurricane Sandy _Staten Island (Photo credit: Tomathon)

The schedule for the week of November 5th  includes:

  • Monday:  ISM Non-Manufacturing Index
  • Tuesday:  Treasury STRIPS
  • Wednesday:  MBA Purchase Applications and Consumer Credit
  • Thursday:  International Trade, Jobless Claims, and Fed Balance Sheet 
  • Friday:  Import and Export Prices, Consumer Sentiment, and Wholesale Trade

This week, I spoke with Benedict Willis III, Managing Director of Albert Fried & Company, LLC., and frequent commentator on Bloomberg, CNBC, and FOX Business, about the economic calendar for next week. This week, the economic calendar is light and thus Willis will be focused on the overall market, the Presidential elections, and weekly initial jobless claims.

Overall Market View

Willis calls it "the perversion of Wall Street," referring to the better than expected jobs data for the month of October. The markets are interpreting the improving jobs data as a sign of strength for the US dollar. All the talk has been about the jobs numbers on the greenback. Willis feels if the economic data we are receiving continues to improve it diminishes the Federal Reserve’s need for intervention which leads to increased market interest rates, lowering the cost of commodities priced in dollar. With the light calendar of economic data this week, he expects the markets to react to headline risk from China, Europe, the middle east, and the rest of the world. He said it could be anything that causes the markets to react, but he warned to keep a watchful eye on China, especially since their economic data has been improving. Europe will also be in focus as the sovereign debt crisis still exists.

Weekly Jobless Claims

Willis said most traders he talked with are expecting the weekly jobless claims data to be revised lower, after the elections. Although he does not focus as much on the BLS numbers, he does rely on the ADP jobs data for trend. He feels the economy is improving at a snail’s pace, not as fast as he would like. People are going back to work, but slowly, and it’s been a drag on the economy. Americans are spending more than they are earning, according to a recent report. This is what the Fed is promoting to get the economy in gear.

Presidential Elections

Willis said he will cast his vote for the third party as he is not in favor of either party in this election. He feels President Obama has not done a terrible job, with the exception of addressing corporate taxes and regulation, but he still has an edge in the elections. He predicts a narrow margin win for the president because of his handling of those devasted by Hurricane Sandy.

View From the Trading Floor

Top of mind: concern for the health and well being of all the families affected by Hurricane Sandy. Willis says Americans are caring people and we will get through this natural disaster and come back stronger than before. "We have been through this before, we are tough and resilient, and we will help fellow citizens get back on their feet again."