On Monday 21st: German PPI and Canada’s New Housing Price Index are both due.
On Tuesday 22nd: US Existing Home Sales and Australia’s Judo Bank Services and Manufacturing PMIs are to be released.
On Wednesday 23rd: Flash Manufacturing and Services PMI’s are due from Japan, France, Germany, the Euro Area, the UK and the US, along with Canadian Retail Sales, and US New Home Sales.
On Thursday 24th: US Durable Goods Orders are released, and the Jackson Hole Symposium kicks off today.
On Friday 25th: German GDP and the Ifo Business Climate index are both published.
Weekly outlook
A slew of fresh earnings reports, many coming out of China, as well as important economic reports will keep us busy this week. Investors will also likely be sifting through speeches from notable central bankers and economists attending the annual Jackson Hole Symposium this week for clues as to the direction of future monetary policy.
At last year's summit, stocks plummeted after Fed Chair Jerome Powell suggested in his speech that the central bank was taking a tough stance and would not be backing off in its fight against growing inflation. Investor panic prompted a sell-off, which resulted in the Dow Jones falling 3.03%, to 32,283.40, with losses increasing towards the end of trading. The S&P 500 ended the day down 3.37%, while the Nasdaq Composite ended the day down 3.94%. Economists again expect Powell to make a major speech on Friday that will set the tone for monetary policy for the rest of the year, and potentially cause some volatility in the markets.
Monday 21st of August
Germany's annual Producer Price Inflation (PPI) slowed to 0.1% in June, the lowest reading since December 2020, compared to May's reading of 1%. The PPI on a monthly basis increased from -1.40 percent in May to -0.30 percent in June, and expectations are for a further increase to 0.5% for July when the new data is released at 6:00 AM GMT.
The Canadian New Housing Price Index, due today at 12:30 PM GMT, decreased by 0.7% from the prior year in June, slightly widening the 0.6% reduction in May and making it the third straight month of declines since November 2019. The decline is in part due to the sustained downward pressure from high borrowing rates, and is expected to fall further for July to around -0.8% year over year.
Major Earnings Reports:
BHP
Tuesday 22nd of August
Numbers for Existing Home Sales in the US are due at 2:00 PM GMT on Tuesday. Having declined 3.3% to a seasonally adjusted annualised 4.16 million units in June, it was the lowest level seen in five months. A further dip is forecast for July, down to around 4.15 million sales year over year.
Australia’s Judo Bank Services and Manufacturing PMIs are scheduled at 11:00 PM GMT today. Services dipped to 47.9 in July, down from 50.3 in June, shrinking for the first time in four months and marking the year's lowest rating. The most recent drop in services activity was mostly down to the negative effect of higher interest rates on spending and company confidence. Manufacturing is showing indications of stabilisation however, with a milder contraction in new orders last month, as well as the clearing of backlogged work due to increased workforce levels. Expectations are for an improvement from 49.6 to 50.1 for August.
Major Earnings Reports:
ANTA Sports Products
Wednesday 23rd of August
Flash Manufacturing and Services PMI’s are due from Japan, France, Germany, the Euro Area, the UK and the US across the day today. Services remained strong across the board last month, and many are forecast to remain in growth territory, whereas manufacturing across Europe, the UK and the US are generally well below the par level of 50, indicating contraction in the industry. These are closely watched by investors as PMIs are a leading indication of economic health as company purchasing managers often have a current and relevant economic outlook.
According to a preliminary estimate, Canada's retail sales in June are anticipated to have slowed around -0.1% from the previous month. In May, retail sales increased by 0.2%, which was revised down from the initial estimate of a 0.5% increase and slowed from the downwardly revised 1% increase in April. These figures released at 12:30 PM GMT will likely serve to confirm the effect of tightening monetary policy from the BoC.
US New Home Sales for July are due at 2:00 PM GMT today. In June, the seasonally adjusted annualised rate of sales for new single-family homes fell 2.5% from May's 15-month high of 715k and fell short of the market estimate of 725k. The newest data is expected to show an increase to 701k for July.
Major Earnings Reports:
NVIDIA Corporation
China Construction Bank
AIA Group
Thursday 24th of August
US Durable Goods Orders are due to be released at 12:30 PM GMT today. In June, there was a significant increase of 4.7% in new orders, which is the largest month-over-month increase since July 2020 and adds to a growing trend of positive results over four consecutive months. July figures are currently forecast to correct the trend and fall by around 4% month over month.
Thursday marks the beginning of the annual Economic Policy Symposium, which takes place in Jackson Hole, Wyoming over three days. It attracts a diverse range of attendees including central bankers, finance ministers, academics, and financial market professionals hailing from various countries around the globe.
The press is not granted access to the sessions, however, officials often engage in discussions with reporters over the course of each day. The remarks and addresses delivered by central bankers and other powerful authorities have the potential to generate substantial fluctuations in financial markets.
Major Earnings Reports:
PetroChina
Meituan Class B
China Citic Bank
Intuit Corp
Royal Bank of Canada
Friday 25th of August
The second-quarter GDP results for Germany are expected to be announced today at 6:00 AM GMT. Preliminary estimates indicate that the German economy fell 0.2% annually in the second quarter of this year, the same as the previous quarter's corrected 0.2% annual decline which confirmed that the country had moved into a period of recession. Quarter-over-quarter expansion is also expected to be flat.
For the third month in a row, Germany's Ifo Business Climate index has dropped, this time to 87.3, the lowest level since November. As a result of ongoing inflationary pressures and rising borrowing rates, the most recent data indicates that Europe's biggest economy still has strong headwinds to contend with in its economic recovery. When the new data is released at 8:00 AM GMT today, expectations are for another dip to around 86.9 for August.
Major Earnings Reports:
China Merchants Bank
China Petroleum and Chemical Corp
China Shenhua
Bank of Communications
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