On Monday 23rd: Australia releases Manufacturing and Services PMIs
On Tuesday 24th: Germany's GfK Consumer Climate Indicator is due, the UK releases Employment data and Manufacturing and Services PMIs are due from Japan, France, Germany, the EU, the UK and the US.
On Wednesday 25th: Australia publishes CPI data, Germany’s Ifo Business Climate Indicator is due, the BOC meets on Monetary Policy and US New Home Sales are reported.
On Thursday 26th: The ECB meets on Monetary Policy, US New Durable Goods Orders are released, along with US GDP and Pending Home Sales.
On Friday 27th: French GDP and Inflation data are published, as well as US PCE Prices, Personal Income and Personal Spending.
Weekly outlook
US Big tech earnings are out this week, and there's also no shortage of other major company reports to keep investors on their toes! After Tesla’s earnings miss last week, many will be closely watching for a more positive result from the big five. Apple, Microsoft, Amazon, Nvidia, and Alphabet are predicted to have an average of 34% increase in earnings year over year, according to data from Bloomberg Intelligence.
Also to watch this week are the Monetary Policy Meetings from Canada and the European Union. As inflation and employment continues to run above forecasts, the outcomes of these meetings will be very interesting. Stay tuned!
Monday 23rd of October
Australian Manufacturing and Services PMIs are to be published at 10:00 PM GMT today. From a preliminary reading of 48.2 to 48.7 in September, the Judo Bank Flash Australia Manufacturing PMI increased from the previous month's reading of 49.6. The most recent report indicated that factory operating conditions have declined for seven consecutive months. Whereas the Judo Bank Australia Services PMI improved from 47.8 in August to 51.8 in September, according to the final reading. Both results are expected to fall slightly for October, however, to around 48.6 and 51.1 respectively.
Major Earnings Releases:
Sandvik
ZTE Corp
Koninklijke Philips
Tuesday 24th of October
Germany's GfK Consumer Climate Indicator dropped from a revised -25.6 in September to -26.5 as October began, falling short of expectations and the lowest reading since April. When the latest report is published at 6:00 AM GMT, analysts expect a further decline to around -27 for November.
The UK is due to release a range of employment data today at 6:00 AM GMT, including their Unemployment Rate and Employment Change. The Unemployment Rate increased to 4.3% from May to July, the highest level since the third quarter of 2021, and is expected to remain there for August, suggesting that the labour market may finally be cooling off. Additionally, the number of people employed in the UK fell by 207 thousand in the three months to July, which came on the heels of a 66 thousand drop in the previous period. A further drop of around 198 thousand is expected for the three months to August.
A collection of October Manufacturing and Services PMIs are due across the day from Japan, France, Germany, the EU, the UK and the US, among others. Hundreds of buying managers are surveyed to judge business conditions like employment, production, new orders, prices, supplier deliveries, and inventory.
The PMIs are a leading indication of economic health since firms react swiftly to market conditions and their buying managers may have the most current and relevant economic outlook. Over 50.0 in the index implies industry growth, below shows decline. Services had been climbing across the board for months recently, however this appears to be softening while Manufacturing is mostly gaining some ground.
Major Earnings Releases:
Microsoft
Alphabet
Visa
Coca-Cola
Novartis
Texas Instruments
Wednesday 25th of October
Australia reports its latest CPI data today from 12:30 AM GMT. In the second quarter of 2023, the annual inflation rate fell to 6.0% from 7.0% in the previous period and below market expectations of 6.2%. This was the lowest figure since the third quarter of 2022, as goods inflation slowed. The annualised Q3 figure is expected to fall again to around 5.1%, while the Monthly Indicator for September is expected to fall from 5.3% to around 4.7%.
After being revised up to 85.8 in August, the Ifo Business Climate indicator for Germany dropped to 85.7 in September, below the market forecasts. For the fifth month in a row, business sentiment has declined, however, for the October report, due at 8:00 AM GMT, the forecast is for a slight bump to around 86.9.
The Bank of Canada will meet on Monetary Policy this week, with the decision statement published at 2:00 PM GMT. In its September meeting, the BOC maintained its overnight rate at 5% as financial markets expected, marking another pause in its tightening cycle. The board at the time said that future rate decisions will be based on economic signals, and some believe the recent unexpected cooling of inflation figures will help to encourage another pause.
US New Home Sales are due to be published at 2:00 PM GMT today. August sales fell 8.7% to 675K seasonally adjusted, revising the 8% growth in the prior month, and missing market projections of 700K purchases. The significant fall was consistent with rising mortgage rates, however, analysts expect a slight bump for September to around 679K.
Major Earnings Releases:
Meta Platforms
ASSA ABLOY
Thermo Fisher Scientific
IBM
Boeing
Thursday 26th of October
The European Central Bank will gather for another Monetary Policy Meeting this week, with the decision statement due at 12:15 PM GMT, and a Press Conference to follow a half hour later. The minutes from the most recent ECB meeting revealed that members of the central bank were split on whether or not to raise interest rates last month when rates were raised 25 basis points to 4.50%. Expectations are for the bank to pause the tightening cycles for this month.
After a revised 5.6% drop in July, new orders for manufactured durable goods in the US unexpectedly climbed 0.2% month over month in August. When the new report for September is released at 12:30 PM GMT, expectations are for a further increase of around 0.6% month over month.
The US will publish GDP data today from 12:30 PM GMT. Second quarter growth in the US this year was 2.1%, which was steady from the prior estimate and slightly lower than the upwardly revised 2.2% growth in the first quarter. A bump to around 4.1% is expected for the third quarter compared to the last.
Also from the US comes the monthly Pending New Home Sales report, due at 2:00 PM GMT. In August, sales in the US fell by 18.7% from the same time a year earlier, the sharpest annual drop in three months, with declines occurring in all four regions. A further drop of around 16% is expected year over year for September.
Major Earnings Releases:
Amazon
PetroChina
BYD
Mastercard
Merck & Co
Intel
UPS
Friday 27th of October
A range of French economic data is due today from 5:30 AM GM, including GDP and Inflation figures among others. In the second quarter of 2023, the French GDP increased by 1% from the second quarter of the previous year, and early projections are for another increase of around 0.7% for Q3. French Inflation has been trending down from February’s 6.3% high to 4.9% for August and September year over year.
The US will release its PCE prices, Personal Income and Personal Spending reports today at 12:30 PM GMT. Core PCE prices in the US climbed by 0.1% month over month in August, the smallest gain since November 2020. The annual rate, the Federal Reserve's preferred measure of inflation, fell as expected to 3.9%, the lowest level since May 2021. Growth of around 0.3% is expected for September.
Following a 0.2% increase in July, personal income in the US climbed by 0.4% in August, which was in line with market expectations. Similarly, consumer spending also climbed 0.4% from July to August, following a 0.9% gain in July that was revised upward. Growth of around 0.4% and 0.3% are respectively expected for September.
Major Earnings Releases:
Equinor
Exxon-Mobil
Chevron
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