The Week Ahead on Wall Street

Economic Data

January’s Markit manufacturing PMI, ISM manufacturing index, and motor vehicle sales reports will all be released today. In December, US manufacturing accelerated at the fastest rate seen in over six years. Producers of US-made goods had the strongest control of pricing they have had since 2011 as the coronavirus pandemic has disrupted international supply chains.

Tomorrow data on Q4 housing vacancies will be released. Rental housing vacancies dropped 0.4 percentage points to 6.4% in the third quarter of 2020. Similarly, the homeownership vacancy rate dropped 0.5 percentage points to 0.9%. The homeownership rate was 67.4%—2.6% higher than it had been in the third quarter of 2019.

On Wednesday January’s ADP employment report, Markit services PMI, and the ISM services index will be released. Investors will be closely watching the ADP employment report as December marked an end to the seven-month growth streak in private payrolls. Private payrolls fell by 123,000 in December, though economists surveyed by Dow Jones predicted 60,000 jobs would be added.

Initial jobless claims, Q4 Productivity, Q4 Unit Labor Costs, and December factory orders will be released on Thursday. Initial jobless claims rose less than expected last week. The number of Americans who filed for unemployment benefits for the first time totaled 847,000, which was less than economist expectations of 875,000.

On Friday January nonfarm payrolls, unemployment rate, average hourly earnings, as well as December’s trade deficit and consumer credit will be released. Nonfarm payrolls fell by 140,000 in December despite consensus expectations of a 50,000 gain. Those job losses were largely concentrated in the hospitality industry as bars and restaurants were forced to close.

Earnings

Warner Music Group Corp. (WMG) will report earnings today. Warner recently signed a licensing deal with TikTok to make songs from the music group’s library available on the video-editing and sharing app. The deal added to Warner’s lineup of partnerships with social media companies. The group already has deals with Facebook (FB), Snapchat (SNAP), and others. Warner’s CEO said social media licensing was growing faster than subscription streaming.

Tomorrow Amazon.com Inc (AMZN) will report earnings. Consumer data shows that as of the last day of 2020, over half of Amazon Prime members were on annual subscriptions, which marked the first time that annual subscriptions increased over the holiday shopping quarter. Typically, monthly subscriptions get a boost over the holidays instead. Amazon CEO Jeff Bezos said the retailer has over 150 million members.

On Wednesday Paypal Holdings (PYPL) will release earnings. In January PayPal became the first foreign operator to take full control of a payments platform in China. It acquired the remaining 30% stake in China’s GoPay on the last day of 2020. PayPal already owned a 70% stake in GoPay, which it bought earlier in 2020. The move signaled that PayPal is interested in becoming a larger player in the international online payments market.

Snap (SNAP) will report earnings on Thursday. Late last month, Snapchat announced it would join almost every other app on the market in introducing a new dark mode feature for users in low light. The new feature is not yet available for everyone because Snapchat is doing a phased rollout, but it could increase the app’s popularity among fans of dark mode and people who may want to decrease their exposure to blue light.

On Friday Regeneron Pharmaceuticals (REGN) will hand in its report card. In January the company announced it had reached a deal with the US government to provide 1.25 million doses of its coronavirus antibody treatment. Regeneron’s shares rose 2.6% after the announcement, and hopeful analysts forecast rising revenues for the pharmaceutical giant in 2021.

The Week Ahead at SoFi

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