A preview of the news, earnings, and economic data to expect in the week ahead. This week includes the first German election in 16 years without Angela Merkel and CPI data from Germany and the Eurozone.
What happened this week
5-day performance as of Friday September 24, 9am CET
Source: Finviz.com
US Stock markets slumped at the start of the week and the S&P 500 finally fell 5% from its peak for the first time in over 300 days but then rallied strongly off the 50-day moving average to erase all the weekly losses. The Swiss Market index fell below 12,000 to its lowest since June but also rallied off the lows.
Gold got an early lift with haven flows but erased the gains in the preceding two sessions. Oil had another strong week, reaching its highest levels since the July peak (look out for double top resistance).
Anticipation of (and reaction to) Fed tapering sent the dollar higher through Wednesday but the strong risk-on mood on Thursday saw it fall back from near multi-month peaks versus the pound and the euro. This Swiss franc saw a notable bout of strength versus the euro. EUR/CHF found support just ahead of 1.08.
Top 5 stories for next week:
The 5 events, news stories or market price action that could shape the week ahead:
1. German election
The chance of major market disruption seems minimal but are higher than usual with Merkel’s absence. The biggest surprise would be if one party won a majority. The more likely source of volatility would be if one of the smaller (more extreme right or left) parties made it into a coalition. Most likely the split German electorate results in a coalition with weak power form major change.
For longer term investments, it’s worth considering which stocks might stand to benefit under different governments. Read more in our blog: German election 2021: Primer for Investors | Stocks to watch
2. Evergrande (not out of the woods)
The past week saw a mixture of concern and relief after missed coupon payments and the injection of Chinese central bank liquidity. The big question remains: will Beijing really let it fail? A piece in the Wall Street Journal said officials are preparing for a ‘possible storm’.
3. European inflation
The ECB started tapering this month, acknowledging the higher inflation in Europe but still have no plans in place for higher interest rates. The very dovish and slow return to normal policy from the ECB is weighing on the euro for now but if data starts to show they need to speed up quickly, that could change things considerably.
4. S&P 500: Was that “it” ?
The S&P 500 offered the perfect ‘buy the dip’ setup, rebounding perfectly off the 50 day moving average after the first 5% drop in over 300 days. But was that it? Is Evergrande and the risk it poses to the Chinese property market / economy just a reason for short term jitters? Perhaps.
5. Oil double top?
The price of oil sits at an interesting price point. It is re-testing the July peak ($78 in Brent) while WTI is softer near $74. The next big psychological price level is $80 per barrel. Whether the price breaks higher or puts in a double top will probably hinge on wider market risk sentiment.
Economic Calendar:
TIME (GMT) | Country | Event | CONSENSUS | PREVIOUS | |
Mon 27 | 12:30 | USD | Durable Goods Orders(Aug) | 0.60% | -0.10% |
Tues 28 | 00:30 | AUD | Retail Sales s.a. (MoM)(Aug) | - | -2.70% |
Wed 29 | 23:50 | JPY | Industrial Production (YoY)(Aug) PREL | - | 11.60% |
01:00 | CNY | NBS Manufacturing PMI(Sep) | 50.2 | 50.1 | |
Thur 30 | 09:00 | EUR | Consumer Price Index (YoY)(Sep) PREL | - | 3% |
12:00 | Ger | Harmonized CPI (YoY)(Sep) PREL | - | 3.40% | |
12:30 | USD | Gross Domestic Product Annualized(Q2) | - | 6.60% | |
Fri 1 | 23:50 | JPY | Tankan Large Manufacturing Index(Q3) | 13 | 14 |
01:45 | CNY | Caixin Manufacturing PMI(Sep) | - | 49.2 | |
14:00 | USD | ISM Manufacturing PMI(Sep) | 59.9 | 59 |
Source: FXStreet.com
Corporate earnings:
Date | Company | Report |
Sep-30 | Bristol-Myers Squibb Co. | Annual General Meeting |
Sep-30 | Diageo plc | Annual General Meeting |
Sep-30 | Paychex Inc. | Q1 2022 Earnings |
Sep-30 | Hennes & Mauritz AB (H & M, H&M) | Q3 2021 Earnings |
Sep-30 | Nitori Holdings Co Ltd | Q2 2022 Earnings |
Sep-30 | CarMax Inc. | Q2 2022 Earnings |
Sep-30 | McCormick & Co. Inc. | Q3 2021 Earnings |
Sep-30 | Leucadia National Corp. | Q3 2021 Earnings |
Sep-30 | Renishaw plc | Q4 2021 Earnings |
Sep-30 | boohoo.com plc | Q2 2022 Earnings |
Sep-30 | NWS Holdings LimitedShs | Q4 2021 Earnings |
Sep-30 | John Wiley & Sons IncShs -A- | Annual General Meeting |
Sep-30 | Gujarat Flurochemicals Ltd Registered Shs | Annual General Meeting |
Sep-30 | Bed Bath & Beyond Inc. | Q2 2021 Earnings |
Sep-30 | Nat. Aluminium | Annual General Meeting |
10-Jan | Apollo Global Management Inc Registered Shs -A- | Annual General Meeting |
10-Jan | National Beverage CorpShs | Annual General Meeting |
10-Jan | Daiseki Co Ltd | Q2 2021 Earnings |
10-Jan | KUSURI NO AOKI HOLDINGS | Q1 2022 Earnings |
Sep-27 | FedEx Corp. | Annual General Meeting |
Sep-27 | Bharat Petrol | Annual General Meeting |
Sep-27 | Nine Dragons Paper (Holdings) LtdShs | Q4 2021 Earnings |
Sep-27 | Shimamura Corp | Q2 2022 Earnings |
Sep-27 | Prestige Estates Projects Ltd | Annual General Meeting |
Sep-28 | Micron Technology Inc. | Q4 2021 Earnings |
Sep-28 | Markit Ltd | Q3 2021 Earnings |
Sep-28 | General Mills Inc. | Annual General Meeting |
Sep-28 | Ferguson PLC Registered Shs | Q4 2021 Earnings |
Sep-28 | Factset Research Systems Inc. | Q4 2021 Earnings |
Sep-28 | SYNNEX Corp. | Q3 2021 Earnings |
Sep-28 | Smiths PLC | Q4 2021 Earnings |
Sep-28 | Thor Industries Inc. | Q4 2021 Earnings |
Sep-28 | Gujarat Gas Ltd Registered Shs | Annual General Meeting |
Sep-28 | SUGI PHARMACY CO LTDShs | Q2 2022 Earnings |
Sep-28 | PGE Polska Grupa Energetyczna S.A. | Q2 2021 Earnings |
Sep-28 | Close Brothers Group plc | Q4 2021 Earnings |
Sep-28 | Kajaria Ceramics Ltd | Annual General Meeting |
Sep-28 | Public Power Corp. of Greece | Q2 2021 Earnings |
Sep-29 | Cintas Corp. | Q1 2022 Earnings |
Sep-29 | Next PLC | Q2 2021 Earnings |
Sep-29 | Australian Stock Exchange Ltd. | Annual General Meeting |
Sep-29 | Sports Direct International PLC | Annual General Meeting |
Sep-29 | Idea Cellular Ltd | Annual General Meeting |
Sep-29 | Korn-Ferry International | Annual General Meeting |
Sep-29 | Indian Railway Finance Corpn Ltd Registered Shs 144A Reg S | Annual General Meeting |
Sep-29 | NHPC Ltd | Annual General Meeting |
Sep-29 | Emami Ltd | Annual General Meeting |
Sep-29 | Herman Miller Inc. | Q1 2022 Earnings |
Sep-29 | Vector LtdShs | Annual General Meeting |
Sep-29 | ULVAC Inc | Annual General Meeting |
Sep-29 | Worthington Industries Inc. | Annual General Meeting |
Sep-29 | Worthington Industries Inc. | Q1 2022 Earnings |
Sep-29 | Fluxys Belgium S.A. (D) | Q2 2021 Earnings |
Sep-29 | NovaGold Resources Inc. | Q3 2021 Earnings |
Source: markets.businessinsider.com/earnings-calendar