On Monday 24th: Flash Manufacturing and Services PMIs are due for Japan, France, Germany, the EU, the UK and the US.
On Tuesday 25th: Germany's Ifo business climate index and the CB Consumer Confidence Index are published.
On Wednesday 26th: Australian Inflation is due, along with US New Home Sales, the BoC’s Summary of Deliberations, and the Federal Reserve meets on monetary policy.
On Thursday 27th: Germany's GfK Consumer Confidence Index is released, the ECB meets on monetary policy, and the US publishes its quarterly GDP.
On Friday 28th: The BoJ meets on monetary policy, French GDP and Inflation figures come out, along with German Inflation data, US Core PCE and Personal Spending and Income data.
Weekly outlook
Plenty to keep investors on their toes this week! Earnings season is kicking into full gear, and there's plenty to chew on for economic news too, as some major central banks meet to set their interest rates for the coming period.
Big tech earnings will be followed closely, with many expecting to hear about the gains being made in AI technology lately. After cutting jobs and tightening their belts in the last couple of quarters, expectations are for more positive earnings from big tech firms, despite the persistent headwinds of high inflation, and rising interest rates biting consumer spending.
The Federal Open Market Committee meets to set interest rates, along with the ECB and Bank of Japan. After inflation fell again in June, there is growing optimism that interest rates are nearing their high in the US, and a slowing but far from collapsing jobs market offers hope that a severe recession can be avoided. However, the battle against inflation is far from done. Watch this space!
Monday 24th of July
A host of Flash Manufacturing and Services PMIs for July are due to be published across the day today. Reports from Japan, France, Germany, the EU, the UK and the US are expected with a fairly consistently positive outlook for the service industry in contrast to a general slowdown in manufacturing. According to the index, a number higher than 50 implies growth in the industry, while a number less than 50 suggests decline. Traders actively monitor these polls since buying managers often have early access to firm performance data, which can drive economic performance.
Major Earnings Reports:
Christian Dior
Koninklijke Philips
Tuesday 25th of July
Germany's Ifo business climate index for July is due at 8:00 AM GMT. Confidence dropped to 88.50 in June from 91.50 in May, while the latest results are expected to show a further drop to less than 86, which could be the third result to add to a downward trend.
In the US, the CB Consumer Confidence Index is due at 2:00 PM GMT today. The Conference Board's Consumer Index measures economic confidence by revealing how the population feels about the current economic climate. When consumers are optimistic, they have a tendency to spend more, which enhances consumption and economic growth overall. Forecasts are for an increase to 113 from 109.7 for July.
Major Earnings Reports:
Microsoft
Alphabet
Visa
LVMH
DSV A/S
Danaher Corp
Texas Instruments
General Electric
Unilever
Wednesday 26th of July
Australian inflation figures are due for publication at 1:30 AM GMT today. From a 30-year high of 7.8% in Q4 2022, the annual inflation rate fell to 7.0% in Q1 this year, representing the slowest annual increase in food costs since the second quarter of 2022. For Q2, estimates are for a drop to 6.3% year over year. Compared to last quarter a drop of 1.1% is expected, and a rise to 6% from 5.6% is expected from the new monthly indicator.
New home sales in the United States increased by 12.2% month-over-month in May, reaching a seasonally adjusted annualized rate of 763K. This was the highest level since February of last year. A dip to 722K is forecast for the latest report to be released at 2:00 PM GMT.
The Summary of Deliberations from the Bank of Canada’s last monetary policy meeting is due at 5:30 PM GMT today. In line with market expectations, the BoC increased its target for its overnight rate by 25 basis points in July, bringing it to 5%. This followed the bank's unexpected 25 basis point rate hike at its last meeting and signaling the continuation of its tightening cycle following a brief hiatus in March and April.
In the US, the Federal Reserve is due to meet on monetary policy this week, with its decision on interest rates due at 6:00 PM GMT and Press Conference at 6:30 PM GMT today. In June, the Federal Reserve decided to maintain its 5%-5.25% funds rate target range. Following the FOMC decision, the Fed Chair suggested the importance of further rate hikes this year on several occasions, and expectations are for another 25 basis points rise this month.
Major Earnings Reports:
Equinor ASA
Meta Platforms
Hexagon AB
Coca-Cola
Thermo Fisher Scientific
Rio Tinto
Union Pacific
Boeing
Airbus
AT&T
Thursday 27th of July
Germany's GfK Consumer Confidence Indicator, due at 6:00 AM GMT, slipped to -25.4 in July 2023 from -24.4 the month before and missed market forecasts. Consumer morale fell for the first time in nine months due to lower economic and income prospects, but a slight improvement to around -24 is expected for August.
The European Central Bank is due to meet on monetary policy this week, with its decision statement due at 12:15 PM GMT today and a Press Conference to follow a half hour later. The ECB lifted rates for the eighth time last month to 4.0%, and minutes from the meeting indicate that the bank is far from done with tightening policy as inflation still remains high. Expectations are for a 25 basis point rise this month for both the key rates and Deposit Facility Rate.
Quarterly US GDP for the second quarter is due at 12:30 PM GMT today. Q1 annualized GDP growth was 2%, which was significantly higher than the 1.3% growth seen in the second estimate. The pace of increase in consumer spending surged above forecasts to 4.2%, the highest level in over two years. Growth around 1.8% is expected for Q2.
Major Earnings Reports:
Amazon
Mastercard
AbbVie
L’Oreal SA
McDonald’s
Shell
Linde
Comcast Corp
T-Mobile
Intel
Friday 28th of July
The Bank of Japan meets on monetary policy this week, with its decision on interest rates to be released at 3:00 AM GMT. At its June meeting, the BoJ’s benchmark short-term interest rate was unanimously maintained at -0.1% again while 10-year bond yields were maintained at about 0%. The board also did not alter the 0.5% limit placed on bond purchases. No major changes are expected from this meeting.
France reports its quarterly GDP and Inflation figures at 5:30 AM and 6:45 PM GMT today. In the first three months of 2023, the economy grew by 0.9% compared to the first three months of the previous year. Annualized growth of 1% is expected for Q2, and quarter over quarter should see a 0.1% rise, while annualized inflation is expected to slow slightly from 4.5% to 4.3% for July.
German Inflation data is due at 12:00 PM GMT today. Although inflation had been steadily tracking down for months prior, last month's rate increased from 6.1% to 6.4%. A welcome reduction back to 6.1% is forecast for July.
The US index tracking core personal consumption expenditure prices, which excludes food and energy, increased by 0.3% in May, in line with market expectations, slowing from the 0.4% gain in April. The Federal Reserve's primary indicator of inflation in the US economy, the annual change, increased by 4.6%, a slight decrease from 4.7% in April. 0.2% growth is expected for July compared to last month when the report is released at 12:30 PM GMT today.
US Personal Spending and Income reports are also due at 12:30 PM GMT today. Income and spending have been increasing simultaneously in recent months. Expectations are for income to increase 0.4% again month over month, and spending to likewise increase 0.4% month over month compared to 0.1% in June.
Major Earnings Reports:
Exxon-Mobil
Procter & Gamble Co
Chevron
AstraZeneca
Hermes International
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