Week Ahead

Third-quarter earnings season gets underway next week, with updates expected from major banks such as JPMorgan Chase, Citigroup and Wells Fargo, while minutes from the last FOMC meeting will be watched for further cues on the Fed’s tapering timeline. Other important releases to follow include US, China and India inflation data; US retail sales, UK and Australia jobs report; Eurozone industrial output; and Japan machinery orders.

Investors across the globe will be waiting for the FOMC minutes due Wednesday to see how much “progress” the Fed sees in the US economy and labor market as well as further hints on tapering timing. At its September meeting, the Federal Reserve said that if progress towards employment and inflation goals continues broadly as expected, a moderation in the pace of asset purchases might soon be warranted and interest rate hikes might follow more quickly than expected.

Meanwhile, the third-quarter earnings season will kick off, with big banks including JPMorgan Chase, Goldman Sachs, Bank of America, Wells Fargo, Citigroup and Morgan Stanley reporting.

It is also a relatively busy week ahead in the US on the economic data front. The consumer price report for September will probably show headline inflation rate bouncing back to 5.4 percent, the same as a 13-year high seen in July, while retail sales are seen declining slightly. Meanwhile, the preliminary estimate of Michigan consumer sentiment for October is likely to show a slight improvement in morale, recovering further from August’s decade-low. Other publications to watch for include producer and foreign trade prices, business inventories, JOLTs job openings, NY Empire State Manufacturing Index, and the government’s monthly budget statement.

Elsewhere in America, important data to follow include Canada housing starts and producer prices; Mexico industrial output; Brazil business morale; Argentina inflation rate; and Peru monthly GDP and unemployment rate.

Across the Atlantic, the UK jobs report for the June-August period is expected to show a decrease in the unemployment rate to the lowest level in a year, while the wage growth should slow further from a record high. Britain’s economic calendar is also packed with key updates on monthly GDP data, foreign trade, industrial production and construction output.

Elsewhere in Europe, market watchers will be monitoring data on the Eurozone industrial output and foreign trade. The bloc’s industrial activity likely contracted in August, wiping out all advances made in July. Meanwhile, Germany’s ZEW survey of economic sentiment for October is expected to show investor morale fell for a fifth straight month, holding at the lowest level since the pandemic-fueled drop in March 2020. Other highlights include: European Union car registrations; Germany wholesale inflation; Turkey current account, unemployment rate, industrial and retail trade data; Sweden and Norway inflation rates; and Greece unemployment.

In Asia-Pacific, China will be publishing inflation data, foreign trade figures and monetary indicators for September. Elsewhere, key data in Japan include machinery orders, producer prices and the final reading of industrial output.

Meanwhile, investors in Australia will turn their attention to employment figures, NAB business confidence and Westpac consumer confidence. Across the Tasman Sea, New Zealand is scheduled to publish Business NZ PMI and monthly food inflation. Other highlights for the region include: India consumer and wholesale prices, and industrial production; South Korea interest rate decision and unemployment rate; Malaysia industrial output and retail sales; and the Philippines trade figures.

Categories: Markten