What to know in the week ahead

This week will be holiday-shortened as investors take off Thursday and part of Friday in observance of the Thanksgiving holiday in the U.S.

The New York Stock Exchange and Nasdaq will each close all day on Thursday, and trading will end early at 1 p.m. ET on Friday. Bond trading is also set to close early at 2 p.m. ET on Friday.

While investors take a pause, retail companies are gearing up for what in typical years tends to be one of their busiest weeks. But this year, the throngs of holiday shoppers that usually take to stores across the country on Thanksgiving Day and Black Friday are expected to clear this year, as the pandemic pushes consumers onto their phones and laptops rather than to storefronts.

A number of major retailers pre-announced that they will be closed on Thanksgiving Day, in a move both to help mitigate crowds and promote social distancing, and to give associates who have been working in-person throughout the pandemic a day off. Stores including Target (TGT), Walmart (WMT), Best Buy (BBY), Home Depot’s (HD), Lowe’s (LOW), Macy’s (M) and JCPenney (JCP) announced Thanksgiving Day closures, marking a departure from prior years when retailers scrambled to offer earlier and earlier opening hours to compete for deals-hungry customers.

Still, many of these retailers have already begun offering Black Friday-type discounts in stores and online starting in late October and earlier this month. That’s expected to more than make up for the one-day closures by helping retailers capitalize on resilient consumer demand for goods during the pandemic.

“We have altered our promotional cadence to avoid events that typically cause crowds,” Target CEO Brian Cornell said during the company’s third-quarter earnings call last week. “Rather than concentrating holiday deals around Thanksgiving and Black Friday, we’ve spread our Black Friday offers throughout the entire month of November with weekly promotions spread across different categories throughout the month.”

The company also added over 1,000 mobile checkout devices across its fleet of stores, and offered more items eligible for same-day pickup. Other retailers are also taking on more efforts to help with shoppers’ safety: Best Buy is offering additional order pick-up locations at UPS stores and CVS pharmacies and providing extended curbside pick-up hours throughout the holidays.

A sign reads "SHOP SAFE 6FT APART" due to the coronavirus disease (COVID-19) pandemic as shoppers browse merchandise at the Christiana Mall in Newark, Delaware U.S. November 19, 2020. REUTERS/Mark Makela
A sign reads “SHOP SAFE 6FT APART” due to the coronavirus disease (COVID-19) pandemic as shoppers browse merchandise at the Christiana Mall in Newark, Delaware U.S. November 19, 2020. REUTERS/Mark Makela

The additional weeks’ worth of sales is also poised to help redirect traffic to companies’ websites and push digital sales up even further. Digital comparable sales at Target surged 155% in the third quarter ending in October, and those at Walmart grew 79%. And e-commerce sales at retailers across the U.S. jumped nearly 30% in October this year from the same month last year, in a testament to the shop-by-click frenzy the pandemic has helped accelerate.

Digitally focused companies outside of the U.S. that took a pull-forward approach to their own holiday sales strategy this year have so far reaped the benefits. Chinese e-commerce company Alibaba (BABA) posted sales for its Singles’ Day event that doubled over last year to a record high, as the company started offering discounts at the beginning of the month rather than on the typical day of celebration on November 11 alone.

Executives at Walmart, the country’s largest retailer, on their third-quarter earnings call last week also underscored their expectation that the holiday shopping season would hold up strongly despite the pandemic.

“This holiday season will obviously be unique,” Walmart CEO Doug McMillon said. “While many family gatherings may be smaller, we do believe families want to decorate, celebrate and enjoy food and gifts. They want a sense of normalcy.”

Still, however, some risks remain for the holiday shopping season, especially as new coronavirus cases and hospitalizations have recently surged to record levels in the U.S. Goldman Sachs found in a recent poll that just over half of 1,000 consumers they surveyed said they planned to spend less this holiday season than in years’ past.

Consumer Confidence

This week, the Conference Board’s November Consumer Confidence index is also set to be closely watched in light of the resurgence of coronavirus cases in the U.S. and newly reimposed restrictions on business activities.

States across the country have added curfews, stay-in-place advisories and mask-wearing mandates, hoping to curb the spread of the coronavirus that has so far taken the lives of more than 255,000 Americans and sickened more than 12 million. New cases have averaged more than 168,000 per day over the past week in the U.S., worsening even from the levels seen in April when the virus first raced across major metropolitan areas.

Amid these concerns, economists anticipate the Conference Board’s headline confidence index to edge lower to 97.9 in November from 100.9 in October, according to Bloomberg consensus data. A weakening reading may indicate consumers with less of a propensity to spend, thereby further anchoring economic activity and softening the economic recovery that had tentatively been under way this summer. Throughout 2019, the consumer confidence index had averaged at nearly 130 per month.

Still, the past couple weeks have also seen Pfizer (PFE) and Moderna (MRNA) come out with much better-than-expected efficacy data for their COVID-19 vaccine candidates, giving consumers reason to hold out hope for a better 2021.

“It will be interesting to see if COVID is prompting concern amongst households or whether new equity market highs and positive vaccine developments can offset that,” James Knightley, chief international economist for ING, said in a note Friday. “The election outcome could also play its part, particularly regionally.”

Economic Calendar

Monday: Chicago Fed National Activity Index, October (0.27 in September); Markit US Manufacturing PMI, November preliminary (53.0 expected, 53.4 in October); Markit US Services PMI, November preliminary (55.0 expected, 56.9 in October); Markit US Composite PMI, November preliminary (56.3 in October)

Tuesday: FHFA House Price Index month-over-month, September (0.9% expected, 1.5% in August); S&P CoreLogic Case-Shiller US Home Price Index year-over-year, September (5.71% in August); S&P CoreLogic Case-Shiller 20-City Composite Index month-over-month, September (0.7% expected, 0.47% in August); S&P CoreLogic Case-Shiller 20-City Composite index year-over-year, September (4.75% expected, 5.18% in August); Conference Board Consumer Confidence, November (98.0 expected, 100.9 in October); Richmond Fed Manufacturing Activity Index, November (23 expected, 29 in October)

Wednesday: MBA Mortgage Applications, week ended Nov. 20 (-0.3% during prior week); Initial Jobless Claims, week ended Nob. 21 (733,000 expected, 742,000 during prior week); Continuing Claims, week ended Nov. 14 (6.372 million during prior week); Advance Goods Trade Balance, October (-$79.9 billion expected, -$79.4 billion in September); Wholesale Inventories month-over-month, October (1.6% in September); Retail Inventories month-over-month, October (1.6% in September); GDP Annualized quarter-over-quarter, 3Q second print (33.1% expected, 33.1% in advance print); Personal Consumption quarter-over-quarter, 3Q second print (40.8% expected, 40.7% in advance print); GDP Price Index, 3Q second print (3.6% expected, 3.6% in advance print); Core Personal Consumption Expenditures quarter-over-quarter, 3Q second print (3.5% expected, 3.5% in advance print); Durable Goods Orders, October preliminary (0.9% expected, 1.9% in September); Durable Goods Orders Excluding Transportation, October preliminary (0.4% expected, 0.9% in September); Non-defense Capital Goods Orders Excluding Aircraft, October preliminary (0.7% expected, 1.0% in September); Non-defense Capital Goods Shipments Excluding Aircraft, October preliminary (0.3% expected, 0.5% in September); Personal Income, October (0.1% expected, 0.9% in September); Personal Spending, October (0.4% expected, 1.4% in September); PCE Core Deflator month-over-month, October (0.0% expected, 0.2% in September); PCE Core Deflator year-over-year, October (1.4% expected, 1.5% in September); University of Michigan Sentiment, November final print (77.0 expected, 77.0 in preliminary print); New Home Sales month-over-month, October (1.7%. expected, -3.5% in September); FOMC Meeting Minutes, November meeting

Thursday: N/A

Friday: N/A

Earnings Calendar

Monday: Warner Music Group (WMG) before market open; Urban Outfitters (UO), Agilent Technologies (A), Nutanix (NTNX) after market close

Tuesday: Best Buy (BBY), Burlington Stores (BURL), Dollar Tree (DLTR), Dick’s Sporting Goods (DKS), Analog Devices (ADI) before market open; Dell Technologies (DELL), VMWare (VMW), Nordstrom (JWN), American Eagle Outfitter (AEO), HP Inc (HPQ), Autodesk (ADSK), The Gap (GPS) after market close

Wednesday: Deere & Co. (DE) before market open

Thursday: N/A

Friday: N/A

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

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