A look at some of the key business events and economic indicators upcoming this week:
JOB MARKET BELLWHETHER
The Labor Department issues its latest monthly tally of job openings Tuesday.
The number of open jobs at the end of November slipped 1.6% to 6.5 million, its first drop since August. At the same time, layoffs soared 17.6% to 1.9 million, driven mostly by layoffs at restaurants, bars and hotels, which more than doubled. Economists expect that the number of open jobs edged higher in December to 6.6 million.
Job openings, in millions, by month:
Dec. (est.) 6.6
A measure of inflation at the consumer level is expected to have risen again last month.
The consumer price index rose 1.4% in December from a year earlier, well below the Federal Reserve’s 2% target. Economists project that January’s consumer price index will show a 1.5% increase. Even so, analysts believe inflation will remain subdued with the U.S. economy still unable to break out of its pandemic-induced downturn. The Labor Department delivers its January index of U.S. consumer prices Wednesday.
Consumer price index, annual percent change, not seasonally adjusted:
Jan. (est.) 1.5
SPOTLIGHT ON DISNEY
Wall Street expects Walt Disney racked up more losses in the last three months of 2020.
Analysts predict Disney will report Thursday that it remained in the red in its fiscal first quarter versus a year earlier. The company slid to a loss in its fourth quarter. Disney’s earnings have been eaten up by costs related to the company’s restructuring of its streaming services and lost revenue from its California theme parks, which remain closed due to the coronavirus.
Featured Article: What is Net Asset Value (NAV)?7 Hotel Stocks Just Waiting For the Vaccine
Like any group of stocks related to travel and tourism, hotel stocks saw a steep drop in share prices in 2020. The leisure and hospitality sector that once had 15 million employees has lost 4 million jobs since February.
Many major cities will be feeling the ripple effects of the Covid-19 pandemic for years. However, there is ample evidence that shows the pandemic may be coming to an end. The number of new cases is dropping. The number of those getting vaccinated is rising. And even in the cities with the most restrictive mitigation measures, the slow process of reopening is beginning.
All of this can’t come fast enough for individuals who rely on the travel and tourism industry for their livelihood. Hotel chains had at least some revenue coming in the door. And when earnings season concludes, the more budget-friendly hotel chains may realize revenue that is 75% of its 2019 numbers. But that is not enough to bring the hotels to anywhere near full employment. Particularly with hotels that have bars and restaurants that have remained closed or open at limited capacity.
Many economists are optimistic that travel may begin to look more normal by the summer of this year. And the global economy may deliver 6.4% GDP growth this year. With that in mind, the hotel chains with the best fundamentals and the broadest footprint will be in the best position as the economy reopens.
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