• ISM manufacturing the key report today
• Most of the markets are closed for the Labour Day
• Fed and ECB decisions the main events this week
• Apple highlights another busy week in earnings

Monday morning is very calm on the markets as most of the markets in Europe and a some in Asia are closed. The futures for US indices do trade but there’s hardly any action there and FX moves are contained. However, all this could change dramatically as the week unfolds. We will get plenty of data with the NFP report the prime one, earnings including a much anticipated report from Apple but most of the attention will be on central banks – the Fed and the ECB.

Both banks are expected to raise interest rates. For the Fed the move will see the rate target travelling above the 5% mark. The ECB hinted at least another one 50 bp move (that would take the depo rate to 3.5%) but interestingly markets await 25 move. The moves could end the tightening cycle especially in the US and the rhetoric from J Powell will be much more important for the markets than the decision (which has been well communicated). A clear suggestion of the end of the cycle could be seen as very positive for the markets.

In the calendar today:

US: final PMI manufacturing – 3:45 pm CET
US: ISM manufacturing – 4 pm CET

In the calendar this week:

Tuesday:

RBA decision (no move expected), 6:30 am
EMU inflation for April, 11:00 am

Wednesday:

US ADP report, 2:15 pm
US ISM services, 4 pm
US FOMC decision, 8 pm and post meeting conference, 8:30pm

Thursday:

ECB decision, 2:15 pm and post meeting conference, 2:45 pm
Apple quarterly report – after the US session

Friday:

US NFP report, 2:30 pm

US flash Markit PMIs were very positive – will it be confirmed by the ISM today? Source: XTB, Macrobond