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The week ahead: 4-8 August

A look ahead to the major events, economic releases and company news expected next week.

HSBC external: the bank is reporting on Monday
Source: Bloomberg

Markets have finally been subjected to a spark of volatility over the past few weeks, culminating with a fairly hefty move to the downside for the key benchmark indices today. The culmination of geopolitical tensions, Argentinian defaults and the heightening speculation on Federal Reserve monetary policy tightening has all conspired to take some of the heat off the recent equity highs. Profit taking, as we leave the main fray of corporate earnings, has also take a bite out of the upside.

The payrolls number may have missed expectations but the addition of 200,000 for the past consecutive six months puts the US economy in a good light. Focus shifts to Europe and Asia this coming week, with PMI data and interest rate decisions keeping our attention.

The dollar is on the front foot today, rising through its February highs, so with the European Central Bank and Bank of England due to announce rate decisions on Thursday, it will be interesting if the greenback can sustain its lofty position and equity markets recoup their losses.

Economic reports

Monday

Australian retail sales (June), 2.30am: This primary gauge of consumer spending declined, missing expectations last month. A bounce of 0.3% is expected this month. Market to watch: AUD/USD

UK construction PMI (July), 9.30am: This survey print left expectations in its wake last month, with 62.6 against 59.7 expected. This month the consensus is for a print of 62.1 . Market to watch: GBP/USD, EUR/GBP

Tuesday

Japan services PMI (July), 2.35am: This is expected to remain in the contractionary zone. A print of 49.0 is expected. Market to watch: USD/JPY

China services PMI (July), 2.45am: June’s survey showed a 15-month high. Expected to remain in expansion in July. Market to watch: China A50, AUD/USD, copper

RBA bank meeting (August), 5.30am: Rates on hold for 12 months now and not expected to move in August from current 2.5%. Watch for hawkish language. Market to watch: AUD/USD

France, Germany, eurozone services PMIs (July), 8.50am – 9am: Survey expected to show prints of 50.6, 56.6 and 54.4 respectively. Market to watch: EUR/USD, EUR/GBP, DAX, EStoxx 50

UK services PMI (July), 9.30am: 58.1 forecast, an improvement on last month’s 57.7. Market to watch: GBP/USD, EUR/GBP, FTSE 250

US services PMI (July, final), 2.45pm: 56.6 is forecast here. Market to watch: US indices, dollar crosses

Wednesday

UK industrial and manufacturing production (June), 9.30am: Month-on-month growth of 0.6% and 0.7% expected. Market to watch: GBP/USD, EUR/GBP

Thursday

Australian unemployment rate (July), 2.30am: Expected to remain at 6%. Market to watch: AUD/USD, ASX 200

Bank of England decision (August), 12pm: No change is expected. Rates to remain at 0.5%. Quantitative easing static. Market to watch: GBP/USD, EUR/GBP

ECB decision (August), 12.45pm, press conference 1.30pm: Minimum bid rate to remain on hold at 0.15%. Press conference will offer more clues to policy decisions. Market to watch: EUR/USD, EUR/GBP, DAX, CAC, Estoxx 50

Initial jobless claims, 1.30pm: Expected to increase to 305,000 from last week’s 302,000. Market to watch: US dollar crosses, US indices

Friday

UK trade balance (June), 9.30am: A deficit of £8.9bn is slated here. A small improvement from last month. Market to watch: GBP/USD, EUR/GBP

Canadian unemployment rate (July), 1.30pm: Expected to decline to 7% from last month’s 7.1%. Market to watch: USD/CAD

 

Company announcements

Monday

Intertek, HSBC, Fidessa, Afren, American International Group

Tuesday

Standard Life, InterContinental Hotels, Inmarsat, Fresnillo, Man Group, Aggreko, Meggitt, Disney, Groupon

Wednesday

Friends Life, Legal & General, Standard Chartered, Time Warner, Twenty-First Century Fox, AOL

Thursday

Randgold Resources, Henderson, AMEC, RSA, Aviva, Rio Tinto, Old Mutual, Spirax-Sarco, Zynga

Friday

TUI Travel

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