Search
EN Down
Language
Hi, user_no_name
Live Chat

Lunar New Year

 

Some major inflation releases this week will drive the macro narrative in the markets as investors try to guess when the Federal Reserve and other central banks will start cutting rates.  

Earnings season continues on Wall Street with a couple of blue chips and some speculative tech names into the mix. China is largely shut for the Lunar New Year holiday. 

 

Here are the week’s key events: 

 

Monday: How Lunar New Year Affects Asian Markets and EU Forecasts 

China and much of Asia, including Japan and Hong Kong will be closed for the Lunar New Year holiday, though Chinese lending and money supply data are slated for release this week. EU economic forecasts are due out as Eurogroup meetings of finance ministers get underway.  

Earnings: Arista Networks (ANET) 

 

Tuesday: US Inflation Data in Focus as Fed Mulls Rate Cut Decision 

Parts of Asia return to action, but China remains closed; New Zealand inflation expectations and Japanese machine tool orders – a leading indicator of industrial demand – are due up. UK employment figures will also be released. 

Swiss CPI data and Germany’s ZEW economic sentiment provide colour during the European session. But it is the US CPI inflation that is the main event for the week: in December it outstripped forecasts at 3.4% vs 3.2% anticipated, whilst the stickiness of core inflation remained evident as this came in at 3.9%, down marginally from 4.0% in November.  

The data is key to the Fed’s decision on when to cut rates – last week’s services PMI prices index pointed to the resilience of inflation and the problems of the ‘Last Mile’; markets have been dialling back expectations for a March cut and it is possible the Fed could wait even longer. 

Earnings: Coca-Cola (KO), Airbnb (ABNB), Shopify (SHOP), Upstart Holdings (UPST) 

 

Wednesday: UK Inflation Surprises BoE and Markets: What’s Next? 

UK inflation figures are the star of the show as markets to price in when the first rate cuts from the Bank of England might arrive. Inflation unexpectedly rose to 4.0% in December, making the BoE more cautious on the speed of easing at its late January meeting.  

Whilst it removed its tightening bias from its monetary policy statement, rate setters remain a way off cutting. Again, it is the rather sticky problem of services inflation, which rose to 6.4% in December from 6.3% in November.  

The BoE said it requires “more evidence” that inflation would continue to fall. Will this CPI report provide it or make the picture more confused? 

Earnings: Barrick Gold (GOLD), Kraft Heinz (KHC), Cisco Systems (CSCO), Twilio (TWLO) 

 

Thursday: US Economic Data Deluge Paints Mixed Picture for Q1 

Australian employment data provides some colour for the Asian session along with the Japanese industrial production reading.  

UK GDP data will be watched as the country skirts a recession and then it is over to the US for a bit of a data dump. The Empire State and Philly Fed manufacturing indices, retail sales figures, industrial production data and the weekly unemployment claims report will paint a vivid picture of the state of the US economy as it heads into the second part of Q1.  

Earnings:  Deere & Co (DE), Applied Materials (AMAT), Coinbase (COIN), Liberty Global (LBTYA) 

 

Friday: US Producer Prices and Consumer Sentiment: Will They Ease Fed’s Inflation Worries? 

French CPI inflation and UK retail sales data provide some direction for the European session as the week’s action comes to a close.  

The main focus though remains in the US where the latest producer price inflation figures are due out, ahead of the UoM consumer sentiment and inflation expectations surveys. Unlike the sticky CPI inflation readings, PPI has been noticeably cooler of late, slipping to 1.0% in December vs 1.3% expected.  

The UoM survey has also been pointing in a happier direction for the Fed – a month ago it showed that year-ahead inflation expectations eased to 2.9%, down from 3.1% in December and 4.5% in November. 

Latest news

Marathon Oil to be acquired by ConocoPhillips in all-stock deal

Thursday, 30 May 2024

Indices

ConocoPhilips stock dips on $22.5bn Marathon Oil buyout news

South African rand falls as ANC seen losing majority in 2024 election

Thursday, 30 May 2024

Indices

South African rand, stocks slip as ANC seen losing majority

Australia inflation rate ticks up to 3.6% in April

Wednesday, 29 May 2024

Indices

RBA on watch as Australia’s inflation rate heats up in April

UBS Global Research issues Street-high S&P 500 forecast

Tuesday, 28 May 2024

Indices

UBS leapfrogs UBS with new year-end S&P 500 forecast

Live Chat