Week Ahead

The US earnings season kicks off next week and several large US banks will report their results for Q2. Investors will also keep an eye on Fed Chair Powell semi-annual report to Congress. On the data front, consumer and producer inflation, retail sales and industrial production will provide an update on the economic recovery. Elsewhere, China GDP growth for Q2, UK CPI and jobless numbers and BoJ interest rate decision will also be in the spotlight.

In the US, investors’ attention turns to Q2 earnings season to kick off next week for an update on the private sector recovery. S&P 500 earnings are estimated to have surged 65.8% from a year earlier, according to Refinitiv. Starting from Tuesday, big banks including JPMorgan Chase, Goldman Sachs, Bank of America, Wells Fargo, Citigroup and Morgan Stanley are due to report. On the data front, June’s consumer price inflation rate will probably remain close to May’s near 13-year high and retail sales figures for June are seen pointing to another month of weak domestic trade as consumers shift spending to services and travel picks up following the latest re-opening efforts. In addition, industrial output is likely to grow for a fourth consecutive month and the preliminary reading of Michigan consumer sentiment for July is set to show a solid improvement in morale.

Elsewhere in America, the Bank of Canada will probably leave monetary policy unchanged when it meets on Wednesday. Other key data to follow include Canada housing starts, ADP Employment Change and final readings of manufacturing and wholesale sales; Brazil business morale; Peru monthly GDP figures and unemployment rate; and Argentina inflation rate.

Across the Atlantic, the UK will publish the jobs report alongside June’s inflation data, producer prices and retail price index. Figures from the ONS are expected to show the unemployment rate remained the lowest since the June-August 2020 period while wage growth is seen at a record high. Elsewhere in Europe, updated reports on inflation will be released for the Eurozone, Germany, France, Italy and several smaller countries. Other data to follow include: the Eurozone balance of trade and industrial production; and Germany wholesale prices. Also, the Central Bank of Turkey is seen leaving its benchmark interest rate steady when it meets on Wednesday.

In Asia, all eyes turn to China’s second-quarter GDP, alongside June’s industrial production, retail sales, unemployment rate, fixed asset investment and house price index. The GDP is expected to have grown 8.1% yoy in the three months to June, slower than the first quarter’s record 18.3 percent expansion. The country’s trade balance will also be in the spotlight, with forecasts pointing to a slowdown in both exports and imports. Other important releases include monetary indicators and foreign direct investment.

Elsewhere, the Bank of Japan is expected to keep its policy interest rate at -0.1% when it holds a meeting on July 15-16. Key economic data include machinery orders, producer prices and the final estimates of industrial production. India is also expected to publish retail and wholesale inflation

In Australia, employment figures, Westpac consumer confidence, NAB Business Confidence, and HIA new home sales will be in the spotlight. Across the Tasman Sea, the Reserve Bank of New Zealand is seen holding interest rates at record-low levels when it meets on Wednesday.

Source: TradingEconomics.com

Categories: Markten