On Monday 15th: German GDP data and the Australian Westpac-Melbourne Institute Consumer Sentiment index are due.
On Tuesday 16th: German Inflation data is due, along with UK Employment figures, the ZEW Indicator of Economic Sentiment for Germany, and Canadian Inflation data.
On Wednesday 17th: Chinese GDP, Industrial Production, Retail Sales and Unemployment figures are all due, along with UK and Euro Area Inflation data, and US Retail Sales.
On Thursday 18th: Australian Employment numbers, US Building Permits and Japanese Inflation figures are due to be published.
On Friday 19th: UK Retail Sales, the University of Michigan Consumer Sentiment Index, and US Existing Home Sales are released.
Weekly outlook
It's another big week of earnings releases and economic data for investors to parse through heading into the middle of January.
Some of the big names in the financial sector are due to release their end of quarter figures this week, including Morgan Stanley and Goldman Sachs Group, among many others. According to Wall Street analysts, Morgan Stanley is expected to announce quarterly profits of $1.23 per share in its release. This would indicate a 6.1% fall in earnings year over year, with revenues of around $12.83 billion forecast, representing a 0.7% rise over the same quarter last year.
Of most interest to traders this week will likely be a host of new inflation data. Having seen price rises gradually drop over the last twelve months, many developed nations are seeing a slowing of progress lately, leaving many to wonder whether interest rates may have further to climb to bring inflation back to target ranges.
Monday 15th of January
Germany will release its full year GDP results for 2023 this morning at 9:00 AM GMT. In 2022, Germany's economy had a growth rate of 1.9%, significantly above the market's anticipated growth rate of 1.8%. However, this growth rate represents a deceleration from the 2.6% expansion seen in 2021.Expectations are for negative growth of around -0.3% for 2023.
Australia’s Westpac-Melbourne Institute Consumer Sentiment index is due to be published at 11:30 AM GMT today. With a 2.7% increase to 82.1 in December last year from 79.9 in November, the index remained in the negative range and marked its second worst year on record largely as a result of a spike in the cost of living and higher interest rates. When the index surpasses 100, it signifies that the number of optimists in the survey exceeds the number of pessimists. The forecast for January is for a slight improvement to around 82.5.
Tuesday 16th of January
A preliminary estimate which will likely be confirmed this morning at 7:00 AM GMT, indicated that the German CPI increased to 3.7% year-on-year in December 2023. If confirmed, this would represent a rise from the previous month's rate of 3.2%, which was the lowest in almost two years.
UK Employment data is due to be released today from 7:00 AM GMT. In the three months leading up to September last year, the employment rate in the UK increased by 50 thousand individuals, just up from the 52 thousand rise seen in the previous month. Around 80 thousand new positions are expected to be added for the reporting period up to October 2023. Meanwhile, the Unemployment Rate, which has held steady for the last five months at 4.2% is also due for November 2023.
After reaching 9.8 in November 2023, the ZEW Indicator of Economic Sentiment for Germany surpassed expectations and reached a high of 12.8 in December last year. This was the highest reading since March, as a greater number of respondents anticipate interest rate decreases by the ECB in the medium term. When the new results for January are released at 10:00 AM GMT, expectations are for a further bump to around 15.
Canada is due to record its Inflation results for December today from 1:30 PM GMT. November 2023 saw no change to the country’s annual inflation rate of 3.1%, which was well above market estimates of 2.9%. Core inflation has also been back on the rise, having moved from 2.7% to 2.8% in November last year.
Major Earnings Releases:
● Morgan Stanley
● Goldman Sachs
● Interactive Brokers
Wednesday 17th of January
China will publish a variety of new data, including its Q4 GDP figures, Industrial Production, Retail Sales, and Unemployment figures today from 2:00 AM GMT. The economy grew by 4.9% year over year in Q3 last year, above market estimates of 4.4%. Following a 4.6% increase in October, China's industrial output increased by 6.6% year-on-year in November 2023, the quickest rate since February 2022. Retail Sales have also been on the rise, having grown 10.1% in the month ending November 2023. Meanwhile, the Unemployment Rate has remained stable at 5% for the last three months.
The UK's annual Inflation Rate dropped to 3.9% in November 2023 from 4.6% in October, which was much lower than expectations of 4.4%. It was the lowest figure recorded since September 2021, and is expected to remain at this level for the December report. Core Inflation has also been tracking down, with a rate of 5.1% achieved in November last year.
Euro Area Inflation is also due today at 10:00 AM GMT. After hitting a two-year low of 2.4% in November last year, the annual inflation rate increased to 2.9% in December, according to a preliminary estimate to be confirmed this week.
After an upwardly corrected 0.2% decrease in October, Retail Sales in the US surprisingly climbed by 0.3% month over month in November 2023, above market expectations of a 0.1% decline. The data indicated that the holiday shopping season was off to a promising start, with sales at restaurants and bars among those that recorded strong growth. Expectations are for a similar growth of around 0.3% for December when the results are released at 1:30 PM GMT.
Major Earnings Release:
● Safestore
Thursday 18th of January
Australia publishes its Employment data at 12:30 AM GMT today. Jobs grew by 61,500 in November 2023 compared to 42,700 the previous month. Meanwhile, the Unemployment Rate, which has been slowly tracking up over the last three months, is expected to remain at 3.9% for the period up to December 2023.
According to updated statistics, the number of Building Permits issued in the US in November last year decreased by 2.1% to a seasonally adjusted annual rate of 1.467 million, the lowest reading in four months. The new figures are due to be updated at 1:30 PM GMT today.
Japanese Inflation is due to be released at 11:30 PM GMT today. As food prices increased for the first time in ten months, Japan's annual headline rate fell to 2.8% in November 2023 from 3.3% in the previous month. This was the lowest reading since July 2022. Expectations are for a further drop to around 2.6% for the period up to December last year. In addition, Core Inflation is also seen to be dropping to around 2.3% from 2.5%.
Major Earnings Releases:
● Taiwan Semiconductor
● American Airlines
● Argan
Friday 19th of January
Monthly Retail Sales are due for the UK for December 2023 today. November last year saw a 1.3% month-over-month gain in sales, which was a sharp increase compared to October's 0.4% increase that defied market expectations and showed stagnating growth. The retail sector had its biggest gain since January, mostly from non-food retailers but also from food stores and fuel. Annualised sales also edged up by 0.1% for November. The new data will be released today from 7:00 AM GMT.
Due to significant improvements in consumers' perceptions about the future of inflation, the University of Michigan consumer sentiment index for the US was revised upward to 69.7 in December 2023 from a preliminary reading of 69.4. This was the highest level in five months. A drop to around 68.8 is forecast for January when the new data is released at 3:00 PM GMT.
US Existing Home Sales figures are due to be published today from 3:00 PM GMT. November last year saw a 0.8% month-over-month increase to a seasonally adjusted annualised rate of 3.82 million units for sales. This was the first monthly increase in five months and a comeback from October's 3.79 million units, the lowest level since August 2010. A similar figure is forecast for the period up to December last year.
Major Earnings Releases:
● Schlumberger
● Burberry Group
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