Investing.com - The Federal Reserve will announce its latest monetary policy decision midweek before the U.S. releases the employment report for April, in what’s set to be a busy week for investors. Corporate earnings continue apace with Alphabet and Apple setting the tone early in the week, while a fresh round of U.S. - China trade talks will also be in focus.
Here’s what you need to know to start your week.
1. Central bank decisions
The Fed is to conclude its two day meeting on Wednesday amid expectations that interest rates will remain on hold. At its March meeting the Fed indicated that it will hold off from hiking rates for the rest of the year amid expectations for a slower pace of economic growth.
Fed Chair Jerome Powell will hold a press conference following the meeting, with investors awaiting his insights on the policy outlook.
The meeting is coming after Friday’s data showing that growth the U.S. economy unexpectedly accelerated in the first quarter. However, the expansion was boosted by gains in trade and inventories which may unwind.
“The bottom line is that there are some growth-positive factors at play here that are unlikely to persist into the second quarter. Having said that though, we continue to expect a solid performance from the US economy this year, particularly if we get some more encouraging news from the US-China trade talks,” ING said. “While we don’t expect the Fed to hike rates again this year, we think it looks pretty unlikely that rate cuts are on the horizon at this stage.”
Elsewhere, the Bank of England also looks likely to leave monetary policy unchanged after its meeting on Thursday, as Brexit drags on.
2. U.S. jobs report
Friday’s nonfarm payrolls report for April tops the list of data releases this week with economists expecting a gain of 181,000 jobs, while the unemployment rate is forecast to hold steady at 3.8%. The U.S. economy added 196,000 jobs in March, rebounding after just 33,000 jobs were added in the previous month.
“Datawise, we look for consumer confidence to be boosted by equity market gains and the ongoing strength in the jobs market. This will be underlined by another decent rise in payrolls and a renewed uptick in wage growth after last month’s surprise dip,” ING said.
3. Earnings reports
With over 150 S&P 500 companies reporting earnings it is set to be another rollercoaster week for investors.
Google’s parent company Alphabet (NASDAQ:GOOGL) is due to report on its first-quarter earnings on after the market close on Monday, while iPhone maker Apple (NASDAQ:AAPL) is set to release its earnings report after the bell on Tuesday.
The earnings calendar also features pharmaceuticals majors Merck (NYSE:MRK) and Pfizer (NYSE:PFE), as well as General Motors (NYSE:GM), Volkswagen (DE:VOWG_p), Fiat Chrysler (MI:FCHA), Royal Dutch Shell (LON:RDSa), BP (LON:BP), ConocoPhillips (NYSE:COP), Samsung (KS:005930), General Electric (NYSE:GE), McDonald’s (NYSE:MCD), Adidas (DE:ADSGN), Mondelez (NASDAQ:MDLZ), Pfizer (NYSE:PFE), Qualcomm (NASDAQ:QCOM), CBS (NYSE:CBS), HSBC (NYSE:HSBC), Berkshire Hathaway (NYSE:BRKa) and Mastercard (NYSE:MA).
4. U.S.- China trade talks
A new round of China-U.S. trade talks is due get under way on Wednesday with U.S. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer travelling to Beijing, ahead of another round of meetings scheduled for the following week in the U.S.
U.S. President Donald Trump on Friday repeated that China trade talks were "going very well," a day after he said that he would soon host Chinese President Xi Jinping at the White House. Trump has said he expects to finalize a deal in a meeting with Xi.
The world's two largest economies have been locked in a tariff war for nearly 10 months, levying hundreds of billions of dollars in duties on each other's goods, and are trying to negotiate a way out.
5. Other economic data to watch
Chinese manufacturing and non-manufacturing PMIs on Tuesday will be closely watched for signs of continuing improvement in the world’s second largest economy after some recent encouraging economic data eased concerns over a slowdown.
The U.S. is to release personal income and spending data on Monday, which is expected to show that income outstripped spending. The U.S. is also to release data looking at auto sales, pending home sales, ISM manufacturing and non-manufacturing activity and consumer confidence.
Both the Eurozone and Canada will report on first quarter growth on Tuesday and the euro area is to publish a preliminary inflation estimate for April on Friday, which is expected to show a slight uptick in consumer prices.
--Reuters contributed to this report