Wall Street Week - Much More Than The Jobs Report

| About: SPDR S&P (SPY)

Summary

Most are keying on the monthly jobs report for the week ahead, but a slew of other data awaits.

Apple (AAPL) will garner much of the market's attention as it throws its Worldwide Developers Conference.

In the end, I expect equities to be driven by hope and possibly evidence of a stronger Q2 over the slushy Q1, as fresh economic data points reach the wire.

Before it even begins, this week's market will be defined by its inclusion of the monthly Employment Situation Report. However, the period is so full of significant events that by the close on Friday, we are likely to have other issues to attribute to the market's direction.

Sector Security

YTD

TTM

SPDR S&P 500 (NYSEARCA:SPY)

+4.3%

+17.9%

SPDR Dow Jones (NYSEARCA:DIA)

+0.9%

+10.5%

PowerShares QQQ (NASDAQ:QQQ)

+3.8%

+24.7%

SPDR Gold Trust (NYSEARCA:GLD)

+3.7%

-10.1%

PIMCO Total Return (NYSEARCA:BOND)

+3.9%

+0.6%

PowerShares DB US Dollar Bullish (NYSEARCA:UUP)

-0.2%

-5.0%

iPath S&P 500 VIX Short-Term (NYSEARCA:VXX)

-21.2%

-56.2%

Click to enlarge

The market surged last week, with the SPDR S&P 500 gaining 1.2%. Economic data offered little reason for the rise, with the GDP report showing a greater contraction than expected, of 1.0%, versus the previously reported 0.1% expansion. Personal spending disappointed as well, dipping 0.1% in April versus expectations for growth of 0.2%. There was one good bit of news though. The Chicago PMI number improved to 65.5, from 63.0 in April; the figure for May beat expectations for a reading of 61.0 and showed strong growth in orders and backlog for the Midwest economy. It was exactly the kind of news that reinforces market expectations for a better Q2. This theme plays true again this week, so pay attention.

Another factor played in favor of stocks last week in my view. It was the Ukraine elections, which went off without a hitch and ushered in nationalist Petro Poroshenko to lead the fractured country. Russian troops also began pulling off the border with Ukraine, which was verified by NATO, so the war concern overhanging stocks seemed to clear away. The SPDR Gold Trust dropped 3.3% as a result, which seems to confirm my case about the market driver here. I've also noted in the past that capital flows go to and fro between stocks and defensive sectors of the investment spectrum (like gold), and some of that played a role here as well. Still, I authored an important article reflecting my view that gold bears are ignoring a demon that still lingers amongst us and could play a secular role for the precious metal's rise.

The Week Ahead

The week ahead offers far more than just the monthly Employment Situation Report, though that will be a key focus of investor attention this week. Economists are looking for an uptick in the unemployment rate to 6.4%, after last month's drop of four-tenths of a point. Nonfarm payrolls are seen increasing at a slower pace in May, with the consensus of economists seeing job creation of just 213K after last month's increase of 288K. Private payrolls are expected to increase by 215K, rather than the 273K increase in April. So the bar appears to be set lower for the benchmark economic data.

That fact, and since there's so much more scheduled this week, implies the report will play a less significant role than usual. To start the week Monday, look for manufacturing data from ISM and Markit Economics. There's very little housing data scheduled this week, so the group will hinge on Monday's construction spending data. Motor vehicle sales and factory orders flood Tuesday's wire. ADP Private Employment data, ISM Non-Manufacturing, Productivity & Costs, and International Trade data do Wednesday good. Thursday throws chain store sales data at us with Challenger's Job-Cuts Report. Plus, the ECB sets monetary policy on Thursday. And Friday brings Consumer Sentiment along with the big jobs number.

Attention! Apple News

Monday offers another key metric, at least for Apple (NASDAQ:AAPL) holders. Apple throws its Worldwide Developers' Conference to start the week. All eyes are on Apple for signs of something exciting and new, with talk of an iPhone payments system that could overrun cash usage and change the way we shop and do business. Some are looking for new information akin to Google's (NASDAQ:GOOG) efforts into technology to manage the home, where the two would compete with already active efforts by cable stalwarts like Comcast (CMSCA). We've been waiting for a smart television for what seems like a decade now, etc. etc. But the stock has already run up into the conference, and seems set for a sell the news possible scenario should Apple come up short of our high hopes. How many times can the boy cry wolf anyway?

Some may have interest in the G-7 meeting scheduled for Thursday in Brussels; it'll be especially interesting when the group of seven meets sans Vladimir Putin. A slew of Federal Reserve men and one Treasury Secretary are also scheduled to speak this week, and the Fed's Beige Book of regional indicators will be released on Wednesday.

In conclusion, I expect investors to look on hopefully at the fresh data, with any uptick seen as evidence for a better Q2 versus the sluggish and slushy Q1. That would invigorate stocks and the S&P 500 to move higher. And that is exactly what I'm looking for this week, no matter what the employment data shows, save an unexpected catastrophic note. It will take a back seat to forward looking forays into equities.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.