US: Focus on jobless claims, trade balance and pending home sales – Nomura

Analysts at Nomura suggest that the release of jobless claims, trade balance and pending home sales data in the forthcoming US session will be the key economic market moving releases for today.

Key Quotes

“Initial jobless claims: Initial unemployment claims reached the lowest point since March 1973 in the week ending 21 October as the transitory impact caused by the recent hurricanes subsides. However, power outages in Puerto Rico and the Virgin Islands after Hurricane Maria disrupted the electronic filing process, which would have significantly delayed increases in unemployment claims. Although we continue to expect initial claims to remain low given strong labor market conditions, delayed filing in affected areas could increase uncertainty on upcoming readings.”

“Advance goods trade balance: We expect the goods trade gap to have widened to $64.6bn in September, from $63.3bn in August. Based on container data at sea ports so far, both nominal imports and exports appeared to have increased, but imports likely exceeded exports. However, uncertainty is high due to disruptions to supply chains and ports in the Gulf Coast area caused by the recent hurricanes.”

“Pending home sales: With strong job markets, consumer demand likely remained firm. However, disruptions brought by the recent hurricanes may have depressed the sales of previously-owned homes, which fell 2.6% in August. Another weak print of pending home sales in September may imply weak existing home sales numbers, which track contract closings. Besides hurricane-related disruptions, the markets for previously-owned homes have been constrained by shortages of homes for sale. These negative factors may have weighed on Q3 residential investment.”