Cyber Monday sales, reports on jobs, and updates from the housing market


Cyber Monday sales, reports on jobs, and updates from the housing market

The major U.S. equity market indexes finished mixed on Friday but recorded gains for the holiday-shortened trading week on optimism following some signs of strength from the retail sector heading into the holiday shopping season and the release of minutes from the Fed’s last meeting suggesting rate hikes might slow soon. The Nasdaq rose 0.7% for the week, while the Dow gained 1.7%, and the S&P 500 climbed 1.5%. 

Next Monday is Cyber Monday in the U.S., a day that will feature numerous deals, discounts, and promotions for online shoppers. Similar to Black Friday, Cyber Monday sales are considered a proxy for the health of the U.S. consumer and retail sector. If Black Friday sales outperform this year, the strong performance could carry over into next week and the remainder of the holiday shopping season. Adobe Analytics forecasts $209.7 billion in online holiday sales this year, an increase of 2.5% compared to last year’s holiday sales. Cyber Monday sales are projected to hit $11 billion, or 5.1% higher than in 2021.1 Despite higher prices, consumers are feeling optimistic, with households of every income level surveyed by Deloitte planning to spend the same amount or more this holiday season than they did last year.2

More earnings will come next week from companies including Salesforce, TD Bank, Dollar General, Kroger, and Ulta Beauty, among others. The labor market will also be in the spotlight, with the Job Openings and Labor Turnover Survey (JOLTS), ADP’s National Employment Report, and the Labor Department’s November nonfarm payrolls report. The latest updates on home prices will become available with the release of the Case-Shiller National Home Price Index and Freddie Mac’s House Price Index (HPI) for September. On Thursday, the Bureau of Economic Analysis (BEA) will release its Personal Consumption Expenditures (PCE) Price Index for October, offering an update on consumer inflation.

A Snapshot of the Labor Market

The U.S. labor market will be in the spotlight next week, with the latest Job Openings and Labor Turnover Survey (JOLTS) report due on Wednesday, tracking job openings, hires, quits, and separations for the month of October. Job openings are projected to have fallen to 10.4 million in October, following an unexpectedly strong reading of 10.7 million openings in September. Also on Wednesday, payroll services provider ADP will release its National Employment Report for November, capturing growth in private sector payrolls. Economists project private businesses added 203,000 positions for the month, following a gain of 239,000 positions in October that exceeded expectations of 195,000.

On Friday, the BLS will release its nonfarm payrolls report for November. The U.S. economy likely added 200,000 jobs this month, decelerating from a 261,000 position gain in October that marked the lowest payroll growth since December of 2020. The unemployment rate is projected to tick higher to 3.8%, up from its current rate of 3.7%. Despite a recent slowdown in job growth, the U.S. labor market remains strong, with unemployment near a 50-year low. As of last month, total nonfarm payrolls exceeded 153.3 million, or 0.5% above their pre-pandemic peak of 152.5 million recorded in February of 2020.

Will Home Prices Continue to Cool?

We’ll also receive the latest updates on home prices next week, indicating whether the housing market continued to cool in September. On Tuesday, index provider S&P Global will release its Case-Shiller National Home Price Index, and mortgage originator Freddie Mac will release its national House Price Index (HPI). Home prices have now fallen for two consecutive months starting in July, and are projected to have declined further in September. Annual price growth, as tracked by the Case-Shiller Index, likely decelerated to 11.4% in September, compared with a 13.1% increase in August and a peak growth rate of 21.3% in April.

The Latest Print on Inflation

On Thursday, the Bureau of Economic Analysis (BEA) will release its latest Personal Consumption Expenditures (PCE) Price Index. The PCE Price Index is the Fed’s preferred measure of inflation, as it more closely tracks spending decisions by U.S. consumers and features a more timely basket of goods and services than the Consumer Price Index (CPI). PCE inflation is projected to have moderated last month, after rising 0.3% in September. On an annual basis, prices likely rose 5.9% from a year earlier, decelerating from a 6.2% gain in September. Core prices, which exclude food and energy costs, likely rose 4.9% year-over-year, decelerating from a 5.1% growth rate in September.

November Auto Sales Outlook

Auto sales in the U.S. likely stagnated in November, as a combination of higher prices and rising interest rates negatively impacted demand. New vehicle sales are projected to reach just over 933,000, marking a 0.3% decline compared to the same period last year, according to a report from J.D. Power and LMC Automotive.3 Total auto sales, which account for both new and used vehicles, are projected at 1.102 million, which would mark a 5.6% increase compared to November of 2021.