Week Ahead 14/8/23: China industrial data; ZEW; RBNZ rate decision; FOMC minutes; Applied Materials, Walmart earnings
The Federal Open Market Committee minutes will be a key reading amid evidence of easing supply chain and input cost pressures. Chinese data come as US-listed shares of Alibaba and JD.com slipped due to investor disappointment.
All eyes on China
Hello, welcome to IGTV. I'm Angeline Ong and this is your look ahead to the coming week. We start on Tuesday with Australia, which is expecting the minutes out of the Reserve Bank Australia.
Also, China out with industrial production and retail sales numbers. That will be very interesting reading given the worsening or weakening of economic data recently out of China.
We've also got the Zentrum für Europäische Wirtschaftsforschung (ZEW) out of Germany and retail sales and import and export prices out of the US. All key as well given that the trade data out of China was particularly weak recently.
Then on Wednesday, look out for a rate decision out of New Zealand from the United Kingdom. We have jobless rate numbers. The producer price index and retail price index will also be one for investors and clients who trade sterling or cable.
Eurozone data on the horizon
Eurozone, we're going to get industrial production figures for June. That will be key as well given it will all be tied into, of course, the consumption weakness out of China.
One of the big set pieces comes then too. We've got the Federal Open Market Committee (FOMC) out of the US. Building permits and housing starts as well for July, which will give us a good indication of how the housing market there is progressing after a weak start.
Then on Thursday, we've got trade balance figures from Japan, Australia's jobless rate for July and initial jobless claims out of the US.
We then end the week with consumer prices from Japan and retail sales for July in the UK plus the Baker Hughes oil rig count as well.
Busy time for UK's corporates
Now, it doesn't get any less busy on the corporate front from the UK. Look out for Lidl in general's first half. From the US, Home Depot's second-quarter figures and, from the United Kingdom, Balfour Beatty on Wednesday out with first-half numbers along with Admiral and Aviva as well.
And on Friday, look out for Estee Lauder's fourth-quarter numbers.
Bonds trading lower
AO: Joining us stateside now is Anthony Batista, co-host of Tasty Live, which is part of IG Group. Bat, thank you so much for joining us. What's really exciting you about next week? Is it the FOMC and after what we heard on the inflation front as well out of the US?
AB: Well, bonds at least are trading lower or at least weaker as of late, trading down to 121. It's about the 30-year long-end bond trading weaker.
They're talking about maybe no more rate hikes by the Federal Reserve Bank (Fed) governors, but you know what? Bonds are the traders, bonds go weaker, rates go higher, a little bit of a tug-of-war here between the traders in Chicago and also maybe the Fed in DC.
AO: So what does that mean for equity markets and volatility as well?
AB: For the first time last week and this week, we saw bonds and stocks going in the same direction. When bonds were stronger early in the week, the market was stronger, the US market was stronger and as bonds have gone lower, as they did on Thursday and so far this morning on Friday, the market's going a little bit lower too.
We haven't been able to hold a rally on the E-mini S&Ps, that's the S&P 500. That area of 45.50 seems to be something that the market can't get above. So next week, I would key on that area, 45.50 on the E-mini S&Ps, you get above that, maybe we can have some action to the upside.
Driverless car sector worth watching
AO: And last but not least, we've heard a lot of chatter here coming out of San Francisco about the vote, which means now that Cruze and the likes of Waymo as well can offer up 24/7 robotaxi services there. What's the word on the ground over in Chicago?
AB: We haven't heard that type of chatter yet here in Chicago. We do have a good technology incubator, maybe the second only to California, so I suspect if they go in that direction, that we'll lean in that direction also, but I haven't heard anything like that.
AO: My thanks to Anthony Batista there, co-host of Tasty Live, part of IG Group. That's your Week Ahead. I'm Angeline Ong and this is IGTV.
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