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September Markets Can Be Volatile: Global Week Ahead
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What is happening across this packed 4-day Global Week Ahead?
Another batch of closely-anticipated U.S. Federal nonfarm jobs data
A high-level regional security gathering happens in Mainland China
Political upset in France, and
The blockbuster Bolsonaro trial in Brazil is coming up
It's time to catch up with that post-summer read in…
Next are Reuters’ five world market themes, re-ordered for equity traders—
(1) The School Year Starts. What Happens in SEP to Risk Markets Can Be Volatile!
Pack away the beach towels and stow the deck chairs, summer (in most places) is over. Markets sense it too.
In a foretaste of the pick-up in activity in September, French markets sold off this week on political turbulence, and the U.S. Treasury curve steepened after President Trump said he would fire Federal Reserve Governor Lisa Cook.
France's Prime Minister, trying to get budget-cut plans across the line, has called a no-confidence vote for September 8th. He is expected to fail.
At the same time, the September Fed meeting will take place against growing angst about central bank independence.
So, that's two already on the September market risks check-list.
Stock markets near record highs, smack of complacency, and bond markets — where plenty of risk is priced in — are unlikely to breathe soon.
(2) On Friday, Sept. 5th, the August Federal Nonfarm Payroll Number Is Out
The next U.S. jobs report on September 5th could cement expectations of an impending Federal Reserve rate cut.
The August non-farm payrolls report is expected to show growth of 78,000 jobs, according to a Reuters poll, versus 73,000 for July.
Last month's weak report, which included huge downward revisions for the prior two months, heightened market expectations the Fed will ease rates in September.
Fed Chair Jerome Powell appeared to support those expectations at his Jackson Hole speech, saying that risks to the job market were rising.
The jobs data coincides with wariness about threats to the Fed independence after Trump set about trying to fire Fed Governor Cook.
(3) Global M&A Is Back — to Highs Not Seen Since 2021
The value of global mergers and acquisitions (M&A) has hit highs not seen since the 2021 post-pandemic boom.
Despite earlier market turmoil and a reduced number of transactions, by the end of the year, we could be near the $4 trillion in deals forecast by some dealmakers last year.
Tariff-driven expansion, sector consolidation and cross-border strategic alliances are some of the drivers. Keurig Dr Pepper's (KDP - Free Report) $18 billion takeover of JDE Peets highlights how companies may be navigating rising U.S. tariffs.
And the takeover of UK assets by largely U.S. bidders will likely continue given an ongoing valuation gap between the two regions. While some deals have taken longer to get done, downward pressure on rates and a strengthening macro environment will support M&A momentum, says BNP Paribas's UK head of advisory Kirshlen Moodley.
(4) On Sunday, 20 World Leaders Gather at a Regional Security Forum in Tanjin, on Mainland China
Over 20 world leaders gather at a regional security forum in China come Sunday, in a powerful show of solidarity when Trump is seeking to double down on his vision of U.S. supremacy.
Russia's Vladimir Putin, welcomed back onto the world stage by Trump in August, joins the Shanghai Cooperation Organization summit in Tanjin. The event also marks the first visit to China by India's Narendra Modi in over seven years.
Days later, Chinese President Xi Jinping hosts North Korean leader Kim Jong Un at Beijing's "Victory Day" parade.
Markets should pay attention as Xi looks to position China as a global force in a shifting geopolitical landscape. China has increased deployments around Taiwan and the disputed South China Sea.
Another round of China PMI releases, meanwhile, is expected to show that economy continues to struggle.
(5) The High-Stakes Bolsonaro Trial Gets Underway in Brazil
Brazil's high-stakes trial of former President Jair Bolsonaro enters its final stretch on Tuesday, with the far-right leader and seven of his closest aides accused of plotting a coup to overturn the 2022 election result.
If found guilty, he could face over 40 years in jail. For markets, the immediate issue is that it could further rile Trump who has already imposed 50% tariffs on Brazilian goods for what he calls the "witch hunt" against Bolsonaro.
Some of Brazil's biggest exports, such as aircraft, energy and orange juice, have so far avoided the tariffs, so the concern is that Trump could turn his attention to them.
A parallel case at Brazil's Supreme Court is investigating Bolsonaro and his son, congressman Eduardo Bolsonaro, for trying to pressure justices to acquit the former president.
That is crucial, too, as it could mean there is no Bolsonaro on the ballot for next year's election and Trump's attacks seem to have lifted current Brazil President Luiz Inacio Lula da Silva's popularity rating.
Zacks #1 Rank (STRONG BUY) Stocks
(1) TE Connectivity (TEL - Free Report) : This is a $208 a share stock, with a market cap of $64.5B. It is found in the Electronic-Miscellaneous Components industry. There is a Zacks Value score of D, a Zacks Growth score of B, and a Zacks Momentum score of D.
Image Source: Zacks Investment Research
TE Connectivity is a global technology company that designs and manufactures connectivity and sensor solutions for a wide range of industries, including automotive, aerospace, defense, energy, and medical. With operations in over 130 countries, the company provides innovative products that enable connectivity across diverse sectors.
Based in Galway, Ireland the company focuses on emerging technologies such as 5G, electric vehicles, industrial automation, and smart cities to position itself at the forefront of connectivity advancements.
TE Connectivity reported net sales of $3.84 billion in fiscal first-quarter of 2025. It reports under the following two segments –
Transportation Solutions (58.5% of first-quarter fiscal 2025 net sales): The segment caters to the needs of automotive, commercial transportation and sensors end markets. It offers sensor solutions and automotive connectivity solutions and products. Its electronic components comprising, connectors, wire and cable, circuit protection devices, heat shrink tubing and molded parts. It also provides application tooling and custom-engineered solutions for the aerospace, defense, and marine markets.
Industrial Solutions (41.5% of first-quarter fiscal 2025 net sales): The segment caters to growing demand for the company’s products in the end markets – industrial equipment, energy, and aerospace, defense, oil and gas. TE Connectivity supplies electronic components, including connectors, relays, circuit protection devices, antennas and heat shrink tubing for industrial machinery, consumer devices, data communications and household appliance markets. Further, it also offers intelligent building and rail products.
(2) Corning (GLW - Free Report) : This is a $69 a share stock, with a market cap of $59B. It is found in the Communication Components industry. There is a Zacks Value score of D, a Zacks Growth score of C, and a Zacks Momentum score of F.
Image Source: Zacks Investment Research
New York-based Corning Inc. started out as a glass business that was reincorporated in 1936. The company has since developed its glass technologies to produce advanced glass substrates that are used in a large number of applications across multiple markets.
Corning reports results under six operating segments:
The Display Technologies segment (25% of total core sales in 2024) includes glass substrates that are commonly found in liquid crystal display (LCD) TVs, notebooks and flat-panel desktop personal computer (PC) monitors. The company’s specialty, active-matrix substrates improve the brightness and sharpness of images.
The company’s Optical Communications products (35.4%) may be categorized into two. The first category comprises cables. Products are typically sold to its own subsidiaries, which then distribute to end users. The second category is hardware and equipment, which comprises optical and copper connectivity products.
Automotive Business (12.7%) is created by separating the Automotive Glass Solutions business from the Hemlock and Emerging Growth Business and converging it with the Environmental Technologies segment in the first quarter of 2025. The segment also makes ceramic substrates required for mobile and stationary pollution and emission control systems. The primary users of Corning’s products are automotive and diesel engine manufacturers.
Specialty Materials (13.3%) include different formulations for glass, glass ceramics and fluoride crystals that render special properties to each separate substrate, making it suitable for specific industrial and commercial use.
Life Sciences (6.5%) products are sold under the Corning, Costar and Pyrex brands primarily for laboratory equipment, such as microplate products, coated slides, filter plates for genomics sample preparation, plastic cell culture dishes, flasks, cryogenic vials, roller bottles, mass cell culture products, liquid handling instruments, Pyrex glass beakers, serological pipettes, centrifuge tubes and laboratory filtration products.
Hemlock and Emerging Growth Businesses, which include solar and semiconductor products and all other businesses that are not part of any other segments, accounted for 7.5% of total sales.
(3) Tencent Music Entertainment Group (TME - Free Report) : This is a $96 a share stock, with a market cap of $42.7B. It is found in the Media Conglomerates industry. There is a Zacks Value score of F, a Zacks Growth score of C, and a Zacks Momentum score of F.
Image Source: Zacks Investment Research
Tencent Music Entertainment Group provides an online music entertainment platform primarily in China.
The company offers online music, recording, and music-centric live streaming services.
Tencent Music Entertainment Group is based in Shenzhen, China.
Key Global Macro
This is a short 4-day trading week. But since it is the start of the month of SEP, it is packed with key macro data.
The week ends with the critical U.S. August nonfarm payroll number.
On Monday, Japan’s Jibun Bank manufacturing PMI for August comes out. 49.9 was the prior reading. 49.9 is the consensus for this month too.
The Mainland China Caixin Manufacturing PMI for August comes out. 49.5 was the prior reading. Don’t expect much change here, either.
The Euro Area HCOB manufacturing PMI comes out for August. 50.5 is the prior reading. 50.5 is consensus.
The Euro Area household unemployment rate comes out for July. Expect a 6.2% number, in line with the prior month.
This was a Labor Day holiday in the USA and Canada.
On Tuesday, the Euro Area’s core HICP consumer inflation rate for August comes out for August. The prior y/y number was +2.3%. The broad HICP number is +2.0% y/y.
The ISM manufacturing PMI for the USA comes out for August. Expect a 48.6 print, which follows 48.0 in July.
On Wednesday, the ECB’s Christine LaGarde gives a speech.
The RBA’s governor Michele Bullock gives a speech in Australia.
The Fed’s Beige Book comes out.
On Thursday, U.S. Challenger job cuts come out for August. The prior month’s data was 62K.
104K was the prior reading.
On Friday, consensus expects U.S. August Federal Nonfarm Payrolls to Rise +78K in August, after rising +73K in July.
Consensus also expects the U.S. household unemployment rate to creep up to 4.3% from 4.2%.
Conclusion
On August 27th, Zacks Research Director Sheraz Mian supplied a fresh large-cap S&P500 and small-cap S&P600 earnings update.
Here are the key points:
(1) For the Retail sector, we now have Q2 results from 98.4% of the sector’s market capitalization in the S&P 500 index.
Total earnings for these Retail sector companies are up +12.9% from the same period last year, on +6.6% higher revenues
75% beat EPS estimates and an equal proportion beat revenue estimates
(2) The Retail sector’s Q2 performance compares favorably to what we have seen from these S&P 500 companies in other recent periods, particularly on the revenues side.
The Q2 earnings and revenue growth pace of +12.9% and +6.6%?
It drops to +1.1% and +4.6% once Amazon’s substantial contribution is excluded from the reported numbers
(3) While the Q2 EPS beats percentage of 75% for these S&P 500 Retail sector companies is tracking below the 20-quarter average of 79.3%.
The revenue beats percentage of 75% is notably above the 20-quarter average of 67.5%
The ex-Amazon revenue growth pace is similarly reflective of an improving growth trend
(4) For the small-cap S&P600 index, we now have Q2 results from 77.1% of the Zacks Retail sector’s members in the index.
Total earnings for these small-cap retailers are up +2.5% on +1.9% higher revenues
70.4% beat EPS estimates and 66.7% beat revenue estimates
The small-cap earnings and revenue growth data are notably week. With the pile-on of more tariffs, fully expect that set of numbers of weaken even more.
A big job loss sequence — from tariff-stressed small and mid-sized U.S. firms — is a credible bear case.
That is it for me.
Enjoy this event and macro data-packed trading week!
John Blank, PhD. Zacks Chief Equity Strategist and Economist
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September Markets Can Be Volatile: Global Week Ahead
What is happening across this packed 4-day Global Week Ahead?
It's time to catch up with that post-summer read in…
Next are Reuters’ five world market themes, re-ordered for equity traders—
(1) The School Year Starts. What Happens in SEP to Risk Markets Can Be Volatile!
Pack away the beach towels and stow the deck chairs, summer (in most places) is over. Markets sense it too.
In a foretaste of the pick-up in activity in September, French markets sold off this week on political turbulence, and the U.S. Treasury curve steepened after President Trump said he would fire Federal Reserve Governor Lisa Cook.
France's Prime Minister, trying to get budget-cut plans across the line, has called a no-confidence vote for September 8th. He is expected to fail.
At the same time, the September Fed meeting will take place against growing angst about central bank independence.
So, that's two already on the September market risks check-list.
Stock markets near record highs, smack of complacency, and bond markets — where plenty of risk is priced in — are unlikely to breathe soon.
(2) On Friday, Sept. 5th, the August Federal Nonfarm Payroll Number Is Out
The next U.S. jobs report on September 5th could cement expectations of an impending Federal Reserve rate cut.
The August non-farm payrolls report is expected to show growth of 78,000 jobs, according to a Reuters poll, versus 73,000 for July.
Last month's weak report, which included huge downward revisions for the prior two months, heightened market expectations the Fed will ease rates in September.
Fed Chair Jerome Powell appeared to support those expectations at his Jackson Hole speech, saying that risks to the job market were rising.
The jobs data coincides with wariness about threats to the Fed independence after Trump set about trying to fire Fed Governor Cook.
(3) Global M&A Is Back — to Highs Not Seen Since 2021
The value of global mergers and acquisitions (M&A) has hit highs not seen since the 2021 post-pandemic boom.
Despite earlier market turmoil and a reduced number of transactions, by the end of the year, we could be near the $4 trillion in deals forecast by some dealmakers last year.
Tariff-driven expansion, sector consolidation and cross-border strategic alliances are some of the drivers. Keurig Dr Pepper's (KDP - Free Report) $18 billion takeover of JDE Peets highlights how companies may be navigating rising U.S. tariffs.
And the takeover of UK assets by largely U.S. bidders will likely continue given an ongoing valuation gap between the two regions. While some deals have taken longer to get done, downward pressure on rates and a strengthening macro environment will support M&A momentum, says BNP Paribas's UK head of advisory Kirshlen Moodley.
(4) On Sunday, 20 World Leaders Gather at a Regional Security Forum in Tanjin, on Mainland China
Over 20 world leaders gather at a regional security forum in China come Sunday, in a powerful show of solidarity when Trump is seeking to double down on his vision of U.S. supremacy.
Russia's Vladimir Putin, welcomed back onto the world stage by Trump in August, joins the Shanghai Cooperation Organization summit in Tanjin. The event also marks the first visit to China by India's Narendra Modi in over seven years.
Days later, Chinese President Xi Jinping hosts North Korean leader Kim Jong Un at Beijing's "Victory Day" parade.
Markets should pay attention as Xi looks to position China as a global force in a shifting geopolitical landscape. China has increased deployments around Taiwan and the disputed South China Sea.
Another round of China PMI releases, meanwhile, is expected to show that economy continues to struggle.
(5) The High-Stakes Bolsonaro Trial Gets Underway in Brazil
Brazil's high-stakes trial of former President Jair Bolsonaro enters its final stretch on Tuesday, with the far-right leader and seven of his closest aides accused of plotting a coup to overturn the 2022 election result.
If found guilty, he could face over 40 years in jail. For markets, the immediate issue is that it could further rile Trump who has already imposed 50% tariffs on Brazilian goods for what he calls the "witch hunt" against Bolsonaro.
Some of Brazil's biggest exports, such as aircraft, energy and orange juice, have so far avoided the tariffs, so the concern is that Trump could turn his attention to them.
A parallel case at Brazil's Supreme Court is investigating Bolsonaro and his son, congressman Eduardo Bolsonaro, for trying to pressure justices to acquit the former president.
That is crucial, too, as it could mean there is no Bolsonaro on the ballot for next year's election and Trump's attacks seem to have lifted current Brazil President Luiz Inacio Lula da Silva's popularity rating.
Zacks #1 Rank (STRONG BUY) Stocks
(1) TE Connectivity (TEL - Free Report) : This is a $208 a share stock, with a market cap of $64.5B. It is found in the Electronic-Miscellaneous Components industry. There is a Zacks Value score of D, a Zacks Growth score of B, and a Zacks Momentum score of D.
Image Source: Zacks Investment Research
TE Connectivity is a global technology company that designs and manufactures connectivity and sensor solutions for a wide range of industries, including automotive, aerospace, defense, energy, and medical. With operations in over 130 countries, the company provides innovative products that enable connectivity across diverse sectors.
Based in Galway, Ireland the company focuses on emerging technologies such as 5G, electric vehicles, industrial automation, and smart cities to position itself at the forefront of connectivity advancements.
TE Connectivity reported net sales of $3.84 billion in fiscal first-quarter of 2025. It reports under the following two segments –
Transportation Solutions (58.5% of first-quarter fiscal 2025 net sales): The segment caters to the needs of automotive, commercial transportation and sensors end markets. It offers sensor solutions and automotive connectivity solutions and products. Its electronic components comprising, connectors, wire and cable, circuit protection devices, heat shrink tubing and molded parts. It also provides application tooling and custom-engineered solutions for the aerospace, defense, and marine markets.
Industrial Solutions (41.5% of first-quarter fiscal 2025 net sales): The segment caters to growing demand for the company’s products in the end markets – industrial equipment, energy, and aerospace, defense, oil and gas. TE Connectivity supplies electronic components, including connectors, relays, circuit protection devices, antennas and heat shrink tubing for industrial machinery, consumer devices, data communications and household appliance markets. Further, it also offers intelligent building and rail products.
(2) Corning (GLW - Free Report) : This is a $69 a share stock, with a market cap of $59B. It is found in the Communication Components industry. There is a Zacks Value score of D, a Zacks Growth score of C, and a Zacks Momentum score of F.
Image Source: Zacks Investment Research
New York-based Corning Inc. started out as a glass business that was reincorporated in 1936. The company has since developed its glass technologies to produce advanced glass substrates that are used in a large number of applications across multiple markets.
Corning reports results under six operating segments:
The Display Technologies segment (25% of total core sales in 2024) includes glass substrates that are commonly found in liquid crystal display (LCD) TVs, notebooks and flat-panel desktop personal computer (PC) monitors. The company’s specialty, active-matrix substrates improve the brightness and sharpness of images.
The company’s Optical Communications products (35.4%) may be categorized into two. The first category comprises cables. Products are typically sold to its own subsidiaries, which then distribute to end users. The second category is hardware and equipment, which comprises optical and copper connectivity products.
Automotive Business (12.7%) is created by separating the Automotive Glass Solutions business from the Hemlock and Emerging Growth Business and converging it with the Environmental Technologies segment in the first quarter of 2025. The segment also makes ceramic substrates required for mobile and stationary pollution and emission control systems. The primary users of Corning’s products are automotive and diesel engine manufacturers.
Specialty Materials (13.3%) include different formulations for glass, glass ceramics and fluoride crystals that render special properties to each separate substrate, making it suitable for specific industrial and commercial use.
Life Sciences (6.5%) products are sold under the Corning, Costar and Pyrex brands primarily for laboratory equipment, such as microplate products, coated slides, filter plates for genomics sample preparation, plastic cell culture dishes, flasks, cryogenic vials, roller bottles, mass cell culture products, liquid handling instruments, Pyrex glass beakers, serological pipettes, centrifuge tubes and laboratory filtration products.
Hemlock and Emerging Growth Businesses, which include solar and semiconductor products and all other businesses that are not part of any other segments, accounted for 7.5% of total sales.
(3) Tencent Music Entertainment Group (TME - Free Report) : This is a $96 a share stock, with a market cap of $42.7B. It is found in the Media Conglomerates industry. There is a Zacks Value score of F, a Zacks Growth score of C, and a Zacks Momentum score of F.
Image Source: Zacks Investment Research
Tencent Music Entertainment Group provides an online music entertainment platform primarily in China.
The company offers online music, recording, and music-centric live streaming services.
Tencent Music Entertainment Group is based in Shenzhen, China.
Key Global Macro
This is a short 4-day trading week. But since it is the start of the month of SEP, it is packed with key macro data.
The week ends with the critical U.S. August nonfarm payroll number.
On Monday, Japan’s Jibun Bank manufacturing PMI for August comes out. 49.9 was the prior reading. 49.9 is the consensus for this month too.
The Mainland China Caixin Manufacturing PMI for August comes out. 49.5 was the prior reading. Don’t expect much change here, either.
The Euro Area HCOB manufacturing PMI comes out for August. 50.5 is the prior reading. 50.5 is consensus.
The Euro Area household unemployment rate comes out for July. Expect a 6.2% number, in line with the prior month.
This was a Labor Day holiday in the USA and Canada.
On Tuesday, the Euro Area’s core HICP consumer inflation rate for August comes out for August. The prior y/y number was +2.3%. The broad HICP number is +2.0% y/y.
The ISM manufacturing PMI for the USA comes out for August. Expect a 48.6 print, which follows 48.0 in July.
On Wednesday, the ECB’s Christine LaGarde gives a speech.
The RBA’s governor Michele Bullock gives a speech in Australia.
The Fed’s Beige Book comes out.
On Thursday, U.S. Challenger job cuts come out for August. The prior month’s data was 62K.
104K was the prior reading.
On Friday, consensus expects U.S. August Federal Nonfarm Payrolls to Rise +78K in August, after rising +73K in July.
Consensus also expects the U.S. household unemployment rate to creep up to 4.3% from 4.2%.
Conclusion
On August 27th, Zacks Research Director Sheraz Mian supplied a fresh large-cap S&P500 and small-cap S&P600 earnings update.
Here are the key points:
(1) For the Retail sector, we now have Q2 results from 98.4% of the sector’s market capitalization in the S&P 500 index.
(2) The Retail sector’s Q2 performance compares favorably to what we have seen from these S&P 500 companies in other recent periods, particularly on the revenues side.
(3) While the Q2 EPS beats percentage of 75% for these S&P 500 Retail sector companies is tracking below the 20-quarter average of 79.3%.
(4) For the small-cap S&P600 index, we now have Q2 results from 77.1% of the Zacks Retail sector’s members in the index.
The small-cap earnings and revenue growth data are notably week. With the pile-on of more tariffs, fully expect that set of numbers of weaken even more.
A big job loss sequence — from tariff-stressed small and mid-sized U.S. firms — is a credible bear case.
That is it for me.
Enjoy this event and macro data-packed trading week!
John Blank, PhD.
Zacks Chief Equity Strategist and Economist