AUSTRALIAN DIARY: Everything you need to know about the week ahead for markets

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ASX200 futures traders have marked up the local index slightly to start the week after the S&P500 had a small boost from the US employment report on Friday.

The US added 222,000 jobs in June against a forecast rise of 152,000. The unemployment rate ticked higher to 4.4% but is still at historically low levels, while wage growth in the US remains sluggish. The June figures showed annual wage growth of just 2.5%.

It’s a similar pattern in Australia, where strong growth in jobs is so far failing to translate into higher wages.

The net effect of Friday’s employment data was that it didn’t materially change the market’s forecast for future moves by the US Federal Reserve.

The expectation is for a steady withdrawal of the Fed’s bond purchasing program to commence in September. The CME Fedwatch tool has currently assigned a 50.9% probability of another rate hike in December.

US 10-year bond yields continued to creep higher to 2.39%, their highest level since mid-May. That increase was exceeded by another big spike in Australian government bonds on Friday night, with the yield on 10-year notes jumping another 10 basis points to 2.76%.

Aussie 10-years have now risen by around 30 basis points since June 27.

The US dollar got a small boost from the employment data, while the AUD rose against most major currencies in overnight trade on Friday and is now back above US76 cents.

Key data in Australia this week kicks off on Tuesday with housing finance figures for May from the Australian Bureau of Statistics.

Markets will assess the continued impact of macro-prudential measures introduced on March 31, after the previous month’s data showed investor lending fell sharply in April.

Also on Tuesday is the widely-read NAB Business Survey for June. The monthly survey has reported generally strong business conditions in 2017, although business confidence fell in May.

On Wednesday there’s Westpac’s consumer confidence index, before overall lending figures (including commercial finance) for May are released by the ABS on Thursday.

Below is a schedule of all the domestic data points for the week ahead (courtesy of Commsec).

Internationally, China releases inflation data on Monday at 11:30am AEST, with annual inflation forecast at 5.5%. Also on Monday, Japan releases its current account data for May.

In the US, markets will be focused on US Fed Chair Janet Yellen’s twice-yearly testimony to Congress on Wednesday night.

Key data in the US is skewed to later in the week, with inflation figures, retail sales and industrial production all scheduled for Friday.

Here’s the international calendar for key data events abroad:

Commsec

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