The week is chock-full with data releases that will confirm if the summer malaise continued in July. As always, Friday's employment report will carry the most weight.
Economists forecast nonfarm payrolls to increase 100,000, somewhat higher than the pace of job growth in June.
Another highlight of this week is the much anticipated Federal Open Market Committee meeting on Tuesday and Wednesday. Some economists expect the Fed to refrain from taking further policy action at the August FOMC meeting and see the September FOMC meeting as a more likely near-term decision point. Others, however, believe with the data weakening and downside risks rising, there's a growing chance that Fed officials will undertake some sort of easing at this meeting.
The most likely action would be to extend the FOMC's forward guidance language until "at least late 2015" from its current late 2014 guidance. Many anticipate the Fed to launch a third round of quantitative easing at the September 12 - 13 FOMC meeting, when they might have further confirmation of a stalled recovery in the labor market and weaker activity and inflation data. There will be no press conference or forecast update at the August meeting.
July auto sales figures are due Wednesday. Ford Motor Company (NYSE: F) will release its results at 9:30 a.m. on Aug.1, followed by a 10:00 a.m. conference call.
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Retailers will report same-store sales results for July on Thursday. Large U.S. retailers set to release results include Macy's, Inc. (NYSE: M), Target Corp. (NYSE: TGT), the TJX Companies Inc. (NYSE: TJX), the Gap Inc. (NYSE: GPS), Limited Brands Inc. (NYSE: LTD), Saks Inc. (NYSE: SKS), Costco Wholesale Corp. (Nasdaq: COST), Kohl's Corp. (NYSE: KSS), Ross Stores Inc. (Nasdaq: ROST), Walgreen Co. (NYSE: WAG), Nordstrom Inc. (NYSE: JWN) and the Buckle Inc. (NYSE: BKE).
Elsewhere, the Bank of England and the European Central Bank are also scheduled to meet this week. Despite President Draghi's pledge to do "whatever it takes" to preserve the euro, the ECB appears unlikely to follow up July's interest rate cut with further major policy announcements.
Another widely watched indicator is China's official Purchasing Managers Index, which is expected to show signs of improvement.
Below are entries on the economic calendar from July 30 to Aug. 3. All listed times are EDT.
8:30 a.m. -- Chicago Fed Midwest Manufacturing Index rose to 94.1 from 93.0 in June.
10:30 a.m. - Dallas Fed Manufacturing Business Index for July.
3:30 p.m. -- Treasury auctions 13-week and 26-week bonds.
U.K. - July nationwide house price index.
U.K. - July CBI distributive trades.
U.K. - July GfK consumer confidence index.
U.K. - June consumer credit, mortgage lending, mortgage approvals and M4 money supply.
E17 - July consumer confidence index, final reading.
E17 - July industrial confidence index, final reading.
Germany - June retail sales.
Spain - July preliminary HICP.
Spain - Q2 preliminary GDP.
Belgium - July CPI.
Korea - June industrial production.
Japan - June unemployment rate, jobs/applicant ratio and real household spending.
TBA - FOMC first day of 2-day meeting.
8:30 a.m. - The Employment Cost Index (ECI) should increase by 0.5 percent in the second quarter, a touch higher than the first-quarter reading of a 0.4 percent gain.
8:30 a.m. - Economists are looking for a 0.4 percent rise in personal income in June and only a 0.1 percent gain in personal spending. This implies an increase in savings rate. Headline PCE inflation should be flat in June as energy prices continued to fall last month. Meanwhile, core PCE inflation should rise a strong 0.2 percent. The benchmark revisions to the monthly income and spending data will be released with this report.
9:00 a.m. -- The S&P/Case-Shiller 20-city Home Price Index should show that prices rose 0.5 percent month-on-month in May, leaving the index down 1.5 percent year-on-year.
9:45 a.m. - Economists expect the Chicago PMI to come in basically flat at 52.5 in July, down marginally from 52.9 in the prior month. Ongoing uncertainty in the economy should offset some of the positive sentiment reading to the strength of the auto sector.
10:00 a.m. - Economists look for the Conference Board Consumer Confidence index to show weakening consumer sentiment in July with a reading of 61.5, compared with a reading of 62.0 in June.
10:30 a.m. - Dallas Fed Services Activity Index for July.
3:30 p.m. -- Treasury auctions 4-week bonds.
India - July RBI reserve repo rate.
Taiwan - Q2 GDP.
Japan - June wages per worker.
Spain - June adjusted retail sales.
Germany - July unemployment change.
E17 - July "flash" HICP.
E17 - June unemployment rate.
Italy - July preliminary HICP, CPI.
Korea - July CPI.
U.K. - July BRC shop price index.
TBA - July 2012 U.S. auto sales results. Analysts expect vehicle sales to reach a seasonally adjusted annualized selling rate of 14 million units in July.
7:00 a.m. -- MBA Mortgage Index for the week ending July 28.
8:15 a.m. - The ADP Employment Change Report is expected to rise by 120,000 in July, after rising 176,000 in June. Over the last several months, the ADP employment measure has been overstating the Bureau of Labor Statistics' figure. Economists expect this trend to continue.
8:58 a.m. - July Markit U.S. Manufacturing PMI, final reading.
10:00 a.m. - Economists look for construction spending to increase 0.4 percent in June, a bit softer than the 0.9 percent increase in May and the 0.6 percent growth in April, but rounding out a fairly solid quarter.
10:00 a.m. - The ISM manufacturing index is expected to edge up to 50.2 in the July release from its prior value of 49.7. While the Empire State and Philadelphia Fed indices rose in July, the Philly Fed remains well below its breakeven level, thus, economists' expectations of an increase remain modest.
10:30 a.m. -- Crude oil inventories for the week ending July 28.
2:15 p.m. - FOMC rate decision. Some economists expect the Fed to refrain from taking further policy action at the August FOMC meeting and see the September FOMC meeting as a more likely near-term decision point. Others, however, believe with the data weakening and downside risks rising, there's a growing chance that Fed officials will undertake some sort of easing at this meeting. The most likely action would be to extend the FOMC's forward guidance language until "at least late 2015" from its current late 2014 guidance. Many anticipate the Fed to launch QE3 at the September 12 - 13 FOMC meeting, when they might have further confirmation of a stalled recovery in the labor market and weaker activity and inflation data. There will be no press conference or forecast update at the August meeting.
China - July PMI manufacturing index.
Japan - July auto sales.
U.K. - July Halifax house price index.
U.K. -- July manufacturing PMI index.
E17 -- July manufacturing PMI index, final reading.
E17 - Publication of the MFI interest rate statistics.
Spain - July manufacturing PMI index.
Italy - July manufacturing PMI index.
France - July manufacturing PMI index, final reading.
Germany - July manufacturing PMI index, final reading.
Belgium - Q2 preliminary GDP.
TBA - July 2012 U.S. retail sales results.
7:30 a.m. - July Challenger job cuts.
8:30 a.m. - Economists look for initial jobless claims to rise to 369,000 for the week ending July 28. That is up from the 353,000 print in the prior week. The volatility from retooling auto plants played a part in last week's better than expected initial jobless claims report.
9:00 a.m. -- Federal Reserve Division of Research and Statistics Deputy Director Michael Eichner testifies on Tri-Party Repo Market before the Senate Banking, Housing, and Urban Affairs Subcommittee on Securities, Insurance, and Investment.
9:45 a.m. - U.S. ISM New York index for July.
10:00 a.m. -- Factory orders are likely to increase 0.5 percent in June, after rising 0.5 percent in May.
Spain -- Prime Minister Mariano Rajoy and Italy Prime Minister Mario Monti meet and discuss on crisis measures.
E17 - ECB interest rate announcement and press conference.
U.K. - August BoE asset purchase decision and bank rate decision.
U.K. - July construction PMI index.
E17 - June PPI.
Ireland - July HICP.
8:30 a.m. - Economists forecast nonfarm payrolls to increase 100,000, somewhat higher than the pace of job growth in June. Private payrolls should rise by 113,000 in the July employment report, while manufacturing payrolls should increase by 10,000. The unemployment rate should hold steady at 8.2 percent. Average hourly earnings will likely gain 0.2 percent, and hours worked should hold steady at 34.5. The trend toward temporary hiring will likely continue.
10:00 a.m. - The ISM non-manufacturing index is expected to decline to 52.0 in July from 52.1.
Russia - Overnight repo rate.
Russia - July CPI.
China - July non-manufacturing PMI.
Turkey - July CPI.
E17 - July composite PMI index, final reading.
E17 - July services PMI index, final reading.
E17 - June retail sales.
Spain - July services PMI index.
Italy -- July services PMI index.
France -- July services PMI index, final reading.
Germany -- July services PMI index, final reading.
Sources: Central banks, European Commission, Reuters, Market News, Capital Economics, Nomura.