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Economic Calendar - Top 5 Things to Watch This Week

EconomyApr 05, 2020 07:02AM ET
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© Reuters.

By Noreen Burke 

Investing.com - With President Donald Trump warning that the U.S. now faces the toughest two weeks of the coronavirus pandemic and economic data beginning to lay bare the full impact of the lockdown investors are bracing for worse to come this week. The main focus will once again be on U.S. labor market, with Thursday’s initial jobless claims report, which has already shown an unprecedented jump of around 10 million over the past two weeks. Oil prices look set to crater again on Monday as the price war between Saudi Arabia and Russia intensifies. Meanwhile, Wednesday’s Federal Reserve meeting minutes may give some insight into the mindset of policymakers as they delivered emergency rate cuts. Here’s what you need to know to start your week.

  1. Trump warns Americans to brace for big spike in virus fatalities

Trump has told Americans to brace for a big spike in coronavirus fatalities in the coming days, as the country faces what he called the toughest two weeks of the pandemic.

"There's going to be a lot of death," Trump said at the White House briefing on Saturday.

The United States has the world's highest number of known cases of COVID-19, the flu-like respiratory disease caused by the coronavirus. More than 306,000 people have tested positive in the United States and over 8,300 have died, according to a Reuters tally.

White House medical experts have forecast that between 100,000 to 240,000 Americans could be killed in the pandemic, even if sweeping orders to stay home are followed.

"We are coming up to a time that is going to be very horrendous," Trump said. "We probably have never seen anything like these kind of numbers. Maybe during the war, during a World War One or Two or something."

  1. Oil set to crater as OPEC+ meeting postponed

Oil price fluctuations have added an extra layer of complication to the coronavirus related market turbulence, crashing 70% from January highs before bouncing on Trump's claim to have brokered a Saudi-Russia deal to cut output.

But prices look set to drop sharply on Monday after OPEC and Russia postponed a Monday meeting to discuss oil output cuts until April 9, as a war between Russia and Saudi Arabia over market share intensified.

Oil recovered from last week's lows of $20 per barrel with Brent settling at $34.83 on Friday, still far below the $66 level at the end of 2019. Prices had their biggest one-day gain ever on Thursday when Trump said he expected Russia and Saudi Arabia to announce a major production cut.

On Saturday, Trump focused instead on tariffs as a response to the oil price crash.

"If I have to do tariffs on oil coming from outside or if I have to do something to protect our ... tens of thousands of energy workers and our great companies that produce all these jobs, I'll do whatever I have to do," the president said.

  1. Jobless claims set to surge again

Thursday’s data on initial jobless claims will be the main release for markets this week. Jobless claims have surged to record levels in the past two weeks, as containment measures to try and slow the spread of coronavirus mean shutdowns are becoming widespread across the U.S. As a result, companies are increasingly shutting their doors and laying-off staff.

Economists are forecasting a reading around the five million mark for initial claims this week.

“With risks skewed towards the containment measures lasting into May, we would not be surprised to see unemployment hit 15% in coming months with our best guess being that the economy contracts 40% in 2Q,” analysts at ING wrote in a note.

  1. Fed minutes

The Fed is to publish what will be closely watched meeting minutes on Wednesday, which investors expect to outline details on the decisions to deliver emergency rate cuts and inject waves of stimulus into the economy.

Calendars released by the U.S. central bank on Friday showed that Chairman Jerome Powell and Trump held two phone calls on Feb. 7 and again briefly on Feb. 26. What exactly they discussed was not immediately clear, but Powell released a statement on Feb. 28 acknowledging evolving risks from the virus and promising the central bank would act as appropriate to support the economy.

The Fed delivered an emergency rate cut on March 3.

  1. Eurozone to debate coronabonds

Euro zone finance ministry officials are to hold discussions this week about how best to aid poorer states buckling under the coronavirus strain. It's safe to say a solution that satisfies everyone won't come by the April 9 deadline. The same divisions remain within the bloc -- Germany and the Netherlands are fiercely opposed to proposals for joint 'coronabonds', favored by France, Italy and Spain.

Joint bonds would assure poorer countries -- and investors -- that prosperous bloc members stand behind them, keeping borrowing costs in check. But likelier options this time around include credit lines from the euro zone's bailout fund, more lending from the European Investment Bank and using a joint long-term budget directly or for guarantees for leveraged borrowing.

Germany will probably dodge joint bonds this time. But another whatever-it-takes moment is inevitable.

--Reuters contributed to this report

Economic Calendar - Top 5 Things to Watch This Week
 

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Comments (21)
Hussnain Safdar
Hussnain Safdar Apr 05, 2020 1:12PM ET
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Untill the promulgation of coronabonds by eurozone dollar will be at bullish position. However, again high votality expected to be seen again
Kok mun Lau
Kok mun Lau Apr 05, 2020 10:56AM ET
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Dow Jobes will happend 2nd down time
Connery Wiltshire
Connery Wiltshire Apr 05, 2020 10:56AM ET
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For sure
Muhammad Irfan
Muhammad Irfan Apr 05, 2020 10:42AM ET
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oil may open gap down near 26-27
Oluwafisayo Aknlosotu
Oluwafisayo Aknlosotu Apr 05, 2020 10:42AM ET
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So it’s a sell when the markets open
Proble Matic
Proble Matic Apr 05, 2020 10:42AM ET
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Muhammad knows at the very least 26-27 because he selling the millions of oil stocks he picked up last week
Allan Seaman
Allan Seaman Apr 05, 2020 10:32AM ET
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hope oil drops
Mickey Lava
Mickey Lava Apr 05, 2020 10:30AM ET
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so buy or sell? and buy sell what specifically
Sibusiso Nokemane
Sibusiso Nokemane Apr 05, 2020 10:30AM ET
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Sell stocks⬇️⬇️
Sibusiso Nokemane
Sibusiso Nokemane Apr 05, 2020 10:30AM ET
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USDCAD
Oluwafisayo Aknlosotu
Oluwafisayo Aknlosotu Apr 05, 2020 10:30AM ET
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Buy GBPUSD too?
Allan KI
Allan KI Apr 05, 2020 10:27AM ET
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While the bearfriends discuss, China walk to cheap victory ...... lol
Michael Redden
Michael Redden Apr 05, 2020 10:27AM ET
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china depend on US so no victory for them..... lol
Adamo Nals
Adamo Nals Apr 05, 2020 10:26AM ET
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And quite literally in this new age of algorithms. We could see 2000 on the S&P this week easily. That’s how fast. I’ve been waiting unfortunately for a 20% down day. Which is coming. Where the market shuts down for the rest of the day
Adamo Nals
Adamo Nals Apr 05, 2020 10:25AM ET
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Simply put just wait for the S&P 500 to hit 1600 to 1800. You’ll get the buying opportunity of a lifetime. And I mean once in a lifetime. But we are not even close to that point yet unfortunate
Clifton Cockroft
Clifton Cockroft Apr 05, 2020 10:19AM ET
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Who really cares about the stock price just buy the same amount weekly and hold
Nelson Neagoe
Nelson Neagoe Apr 05, 2020 10:19AM ET
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Good advice,I think is a great buy for long term.
Michael Redden
Michael Redden Apr 05, 2020 10:19AM ET
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all the day traders will disagree but it a less stressful stategy that will prevail of course
rick pearl
rick pearl Apr 05, 2020 10:19AM ET
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Day trading is inherently not hold, so what they think about long term is totally beside the point.
Kostas Tsolis
Kostas Tsolis Apr 05, 2020 10:15AM ET
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is pointless. Shore storages are full of crude and oceans as well. Many vessels carrying crude waiting in Anchorage waiting the best time to discharge. Profits on traders and owners due to low crude prices are huge but the main problem is that have expiry date. With all storage full , no consumption all of them will have to cut production at the end of the day. The problem is Covid , not the oil. Without consumption on the planet situation will ot change
 
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