Next week will be a busy one, as earnings season continues with reports from Pfizer, Starbucks, Uber Technologies, AMD, Qualcomm, Apple, Royal Dutch Shell, BP, and ConocoPhillips, among many others. Berkshire Hathaway, Warren Buffett’s holding company, will hold its annual shareholders’ meeting in Omaha, Neb. next Saturday. We can expect updates on the labor market with the latest Job Openings and Labor Turnover Survey (JOLTS), ADP’s National Employment Report, and the April nonfarm payrolls report next week. Federal Reserve policymakers will gather for the two-day meeting of the Federal Open Market Committee (FOMC) starting on Tuesday, with an interest rate decision expected on Wednesday, in what will likely be the Fed’s final rate hike of the current tightening cycle.
More Corporate Earnings
Earnings season continues next week with reports from Pfizer, Starbucks, Uber Technologies, AMD, Qualcomm, Apple, Royal Dutch Shell, BP, and ConocoPhillips, among many others. So far this earnings season, S&P 500 companies are recording their best performance relative to analysts’ expectations since the fourth quarter of 2021, according to FactSet. Of the 53% of S&P 500 companies reporting earnings so far, 79% have reported earnings per share (EPS) above consensus estimates, which is above the five-year average of 77% and the 10-year average of 73%. The consumer discretionary sector has recorded the strongest earnings growth of any sector, with earnings up 47.8% from a year ago, on average. The materials sector has been the biggest underperformer so far, with earnings down 30.3% year-over-year.
The Latest Jobs Report
The latest reports on the U.S. labor market will arrive next week. On Tuesday, the Bureau of Labor Statistics (BLS) will release its Job Openings and Labor Turnover Survey (JOLTS) for March, tracking total openings, hires, quits, and separations for the month. Job openings are projected to have fallen to 9.7 million in March, from 9.93 million in February, which would mark the lowest figure in two years.
On Wednesday, payroll provider ADP will issue its National Employment Report for April, tracking private sector payrolls. Private businesses likely added 135,000 positions, compared to a gain of 145,000 in March. This will set the stage for the Labor Department’s nonfarm payrolls report on Friday. Payrolls are projected to have risen just 178,000 in April, which would mark the smallest increase since a loss of 268,000 positions in December 2020. This would suggest a slowing economy and a loosening of a labor market that has remained tight over the past year as the Federal Reserve hiked interest rates.
May FOMC Meeting
Federal Reserve policymakers will gather next week for the latest meeting of the Federal Open Market Committee (FOMC), the central bank’s rate-setting committee. Officials are widely expected to raise the benchmark federal funds rate by 25 basis points to a range of 5% to 5.25%, according to fed funds futures published by CME Group.
in what could be the final rate hike of the Fed’s tightening campaign. Fed policymakers have raised interest rates by a cumulative 475 basis points since March of last year in an effort to tame the highest inflation in four decades.
Berkshire Hathaway's Annual Shareholders' Meeting
Starting next Saturday, Berkshire Hathaway, the holding company owned by Warren Buffett, will hold its annual shareholders' meeting in Omaha, Neb.3 Buffett and his partner, Charlie Munger, will answer shareholders’ questions and discuss their latest investments and developments in the company. Berkshire’s annual shareholder meeting is a widely-publicized event that draws investors from around the world, and offers a glimpse into the work of one of the world’s most successful investors.