Key Takeaways

  • Palantir Technologies goes public on the NYSE on Wednesday.
  • The U.S. unemployment rate for September is announced on Friday.
  • Consumer confidence and expectations are announced on Tuesday and Friday, respectively.

The S&P 500 was down for the week for a fourth straight week, and the Dow Jones Industrial Average fell along with it. Out of the 11 S&P sectors, only 3 were positive for the week, technology, consumer discretionary, and utilities, while the energy sector fell the most.

The Energy Select Sector SPDR ETF (XLE), it fell -8.6% as oil prices dropped due to fears that rising rates of COVID-19 infections would continue to depress demand for fuel. The drop was led by a -6.7% drop from Exxon Mobil (XOM) and a -8.4% drop from Chevron (CVX), the ETF's two largest holdings, which make up about 45% of the fund together. The tech sector performed the best, and rose 2.2% as measured by the benchmark Technology Select Sector SPDR ETF (XLK). The rise was driven by Apple (AAPL) and Microsft (MSFT), which rose 5.3% and 3.7% respectively, and, combined, make up nearly 45% of the fund.

Top and Bottom Performing Sectors 9-25-20
Source: YCharts.com.

This upcoming week will bring the highly anticipated Palantir Technologies IPO, as well as key economic reports from the U.S. the U.K. and Germany. Here's a look at major asset classes' returns year-to-date:

Events This Week

Tuesday, Sept. 29:

Wednesday, Sept. 30:

Thursday, Oct. 1:

  • Market Holidays in Mainland China, Hong Kong, and South Korea for Mid-Autumn Festival, National Day, and Full Moon Festival, respectively
  • Reserve Bank of India Makes Interest Rate Decision
  • German Manufacturing PMI (September)
  • U.K. Manufacturing PMI (September)
  • French Manufacturing PMI (September)
  • Eurozone Manufacturing PMI (September)
  • Eurozone Unemployment Rate (August)
  • U.S. ISM Manufacturing PMI (September)
  • U.S. PCE Price Index (August)

 Friday, Oct. 2:

  • Market Holiday in China, Hong Kong, India, and South Korea for National Day, Mid-Autumn Festival, Mahatma Gandhi Jayanthi, and Full Moon Festival, respectively
  • Eurozone Consumer Price Index (CPI) (September)
  • U.S. Nonfarm Payrolls (September)
  • U.S. Unemployment Rate (September)
  • U.S. Michigan Consumer Expectations (September)

Palantir Direct Listing

Data analytics firm Palantir Technologies is scheduled to go public this upcoming Wednesday through a direct listing on the New York Stock Exchange. It is expected to price at about $10 a share, giving the company a valuation or almost $22 billion. The company forecasts over $1 billion in revenue in 2020, up from $743 million in 2019. Palantir is notable for its extensive work with the U.S. government, creating software to facilitate domestic surveillance. While this work has been controversial, Palantir has embraced this role and in its S-1, it lists its desire to become the "default operating system for data across the U.S. government."

With three months left on the calendar, U.S.-listed initial public offerings have raised nearly $95 billion through Wednesday, according to data provider Dealogic. That already surpasses the totals of every year except 2014 since the tech bubble in 2000.

United States Unemployment

This upcoming Friday, Oct. 2, the September unemployment rate will be announced. As the number of COVID-19 cases begins to tick back up and there is still no fourth stimulus package, it's unclear if the U.S. labor market will continue on its slow recovery or slip backwards. It currently stands at 8.4%, down from 10.1% in July.

Michigan Consumer Sentiment and Conference Board Consumer Confidence

With more than two-thirds of the U.S. economy based on consumer spending, consumer confidence will be a major indicator of the pace of recovery in the U.S. As only 15% of people spent their stimulus checks, while 30% saved them, and 50% used them to pay down debt, America may be caught in a paradox of thrift, in which saving during a crisis, while individual prudent, is collectively detrimental to the economic recovery. The Conference Board Consumer Confidence Index, released this upcoming Tuesday, dropped in August, while the Michigan Consumer Sentiment Index grew slightly. The two indexes have somewhat different methodologies so some slight differences are not cause for alarm. An optimistic note is that the preliminary reading for the Michigan Consumer Sentiment Index, the full version of which comes out this upcoming Friday, showed a significant increase.