Wall Street’s Eyes on New Economic Data

U.S. markets are closed for the Labor Day holiday today. When trading resumes Tuesday, Wall Street will be watching the week’s data on the manufacturing sector, car and truck sales, and employment, which are expected to show the economy avoided a contraction in August.

On Tuesday, investors and others will get a reading on the state of U.S. manufacturing, which makes up one-sixth of the economy, when the Institute for Supply Management releases its monthly manufacturing index.

In July the index fell to 50.5, its lowest level since January. Analysts expect the index to come in at 51.6 for August.

Wednesday, August car sales and truck sales roll in. The figures provide a gauge of consumer spending.

Economists watch consumer spending closely because it makes up two-thirds of economic activity. In recent months, consumers have continued to spend freely, with robust July auto sales and new-home sales hitting a record.

August unemployment figures will be released Friday.

“The health of the labor market is critical input into the whole issue of consumer spending,” said Bruce Simon, chief investment officer of Glenmede Trust Co., which manages $14 billion in assets. “That is one of the key factors in support of the modest rebound we’re experiencing.”

For August, economists are expecting the unemployment rate to be unchanged from the 5.9% level set in July and expect 37,000 jobs to be created.

There are some indications that business spending on equipment and software has stopped declining. A Commerce Department report Thursday on July factory orders probably will show a 4.7% rise.