Manufacturing, job data to be released
After a tumultuous first quarter in the stock market, investors this week will be looking at manufacturing data to gauge whether the economy is strong enough to overcome the ailing housing market.
Today, the Institute for Supply Management will release its March index of the nation’s manufacturing sector. The market is expecting a somewhat lower reading from February but one that still indicates growth.
A lower figure could cause a sell-off, especially given that last week’s Chicago regional manufacturing index came in strong.
The institute will report on the U.S. service sector Wednesday. Analysts predict that the March index will come in at 54.7, indicating slightly faster growth than the February reading of 54.3.
The Labor Department will release key job data Friday. The stock market will be closed for the Good Friday holiday, but investors will be watching.
Analysts predict that March payrolls will rise by 120,000, up from a rise of 97,000 the previous month, but they also anticipate a slight uptick in the unemployment rate to 4.6% from 4.5%.
The Dow Jones industrials finished the first quarter down 0.9%, while the Standard & Poor’s 500 index ended up 0.2% and the Nasdaq composite index ended up 0.3%.
After a huge drop in late February, the major stock indexes could have slipped much further as the sub-prime mortgage market stumbled, the dollar weakened and manufacturing slowed.
However, stability on the job scene provided the stock market with some tread. Investors were assuaged by the belief that if most Americans were still employed, they were still getting paid -- and thus they could still spend money.
Other factors that could give stocks a boost are further signs of strong corporate takeover activity and the belief that first-quarter earnings will show modest growth in company profits.
But the same obstacles that dogged investors in the first quarter remain, notably high inflation, rising energy prices, a weakening dollar and woes in the sub-prime mortgage market.
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The week ahead
Today
* The Institute for Supply Management issues its report on activity in the manufacturing economy for March.
* Treasury bill auction.
* Trial of media mogul Conrad Black resumes in Chicago.
Tuesday
* Automakers release their sales figures for March.
Wednesday
* The Institute for Supply Management issues its report on activity in the non-manufacturing economy for March.
* Commerce Department reports on factory orders for February.
* Quarterly earnings reports due from Best Buy, Circuit City Stores and Monsanto.
Thursday
* Labor Department reports on weekly jobless claims.
* Freddie Mac reports on mortgage rates.
Friday
* Labor Department reports on employment for March.
* Federal Reserve reports on consumer credit for February.
