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Growth data

With the UK starting 2020 by leaving the EU and striking out on its own, markets would like to see that it ended 2019 on a strong economic footing when preliminary Q4 data is released. The data for most Eurozone members will be the second reading; the preliminary estimates showed expansion of just 0.1% as strong growth in Spain helped to offset contractions in France and Italy. Germany’s Q4 reading will be the flash estimate – analysts expect the Eurozone powerhouse to post a contraction of -0.1%.

 

RBNZ – Easing cycle is over

A round of strong labour market data last week has markets pricing in stronger odds that the RBNZ is done with its easing cycle. Unemployment dropped to 4% in Q4 and the underutilisation rate, which measures the labour market’s untapped capacity, fell to an 11-year low of 10% in December.

While the Chinese coronavirus outbreak is the latest economic headwind for markets and central banks to contend with, the strength of the domestic data should see the RBNZ confident enough to stand pat and see how the situation develops.

US CPI

Last month’s CPI reading showed the fastest pace of annual inflation in eight years, but a closer look at the numbers revealed some big weaknesses. Month-on-month, price growth slowed to 0.2% from 0.3% in November, core CPI slowed to 0.1% from 0.2%. Average earnings grew just 0.7% in 2019. More soft readings like this will support the market view that Fed policy will remain on hold until well into H2.

Earnings – Kraft Heinz and NVIDIA

Top reports this week will be Kraft Heinz before the market opens on February 13th and NVIDIA after the closing bell the same day. KHC has had a bad start to 2020, declining around 9% even as the S&P 500 and Nasdaq hit fresh record highs. The company is facing weakening demand and a lack of free cash with which to innovate.

Coronavirus fears caused a small stumble in NVIDIA’s continuing rally, with the stock quickly recovering. China accounts for around a quarter of the chipmaker’s revenue, so management may warn that the virus could dent demand in this key market. EPS of $1.66 is expected on revenue of $2.96 billion – both hefty increases on the same period a year ago.

Key Events

(All times GMT)
01.30 GMT 10-Feb China Consumer Price Index 
06.30 GMT 11-Feb Daimler – Q4 2019 
09.30 GMT 11-Feb UK Preliminary GDP (QoQ) & Manufacturing Production 
Pre-Market 11-Feb Hasbro – Q4 2019 
After-Market 11-Feb Lyft – Q4 2019 
01.00 GMT 12-Feb RBNZ OCR Decision & Monetary Policy Statement 
07.00 GMT 12-Feb Softbank – Q3 2019 
15.30 GMT 12-Feb US EIA Crude Oil Inventories 
After-Market 12-Feb Cisco – Q2 2020 
07.00 GMT 13-Feb Barclays – Q4 2019 
Pre-Market 13-Feb The Kraft Heinz Company – Q4 2019 
13.30 GMT 13-Feb US Consumer Price Index 
15.30 GMT 13-Feb US EIA Natural Gas Storage Data 
After-Market 13-Feb NVIDIA – Q4 2020 
13-Feb Airbus – Q4 2019 
07.00 GMT 14-Feb Germany Preliminary GDP (QoQ) 
10.00 GMT 14-Feb Eurozone Flash GDP (QoQ) 
13.30 GMT 14-Feb US Retail Sales 
15.00 GMT 14-Feb US Preliminary UoM Consumer Sentiment Index

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