Following a week filled with major central bank interest rate decisions we expect this week to be relatively quiet. The Bank of England raised rates for the first time since the financial crisis to 0.75% form 0.50%. This has major implications for capital flows into emerging markets as the higher rates in developing markets will attract capital due to their lesser risk profile. The trade war between China and the USA is also making emerging markets less attractive as investors remain bearish on riskier assets. Locally, last week’s unemployment numbers disappointed and with the GDP forecast being revised downwards, there is an opportunity for unemployment to worsen. I have highlighted a few key events below which could have an impact on your trading this week.
- No significant data is expected from the international markets on Monday. In terms of earnings, locally the recently renamed ABSA Group released its earnings results and during the day we are expecting earnings results from Royal Bafokeng Platinum. From the USA, we are expecting earnings from Marriot International.
- Early on Tuesday morning we are expecting the Reserve Bank of Australia to announce its interest rate decision and initial estimates suggest the bank will leave rates unchanged. At 8am, Germany is expected to release its Industrial Production and Trade Balance numbers, while at 4pm we expect the JOLTS Job Openings numbers. Locally, we are expecting earnings from Nedbank, Liberty Two Degrees and Trencor. In terms of economic data we expect Manufacturing Production data for June, and the reserve bank is expected to release Gross and Net Reserves data. From the USA, we are expecting earnings results for Walt Disney.
- On Wednesday morning Japan is expected to release Bank Lending and Current Account data. Major focus will be on the Trade Balance numbers from China which will be significant for commodity producers given the current trade war tensions. From the USA, we are expecting the weekly Crude Oil Inventories numbers, and on the earnings front we are expecting results for Twenty-First Century Fox, CVS Health, Booking and Southern. It will be an interesting day for local earnings with MTN Group, Glencore and Mpact all expected to release their earnings results. In terms of economic data we are expecting the release of the SACCI Business Confidence index number.
- Japan kicks off the day on Thursday with the release of Core Machinery Orders numbers. China is expected to release its CPI and PPI numbers, and we are also expecting New Loans data from the same country. The USA is expected to release its PPI and Wholesale Inventories data along with the weekly Initial Jobless Claims data. In terms of earnings, from the USA we are expecting earnings from Viacom and News Corp. We are not expecting any data locally.
- Friday will be a busy day in terms of economic data starting off with GDP numbers from Japan as well as PPI and Tertiary Industry Activity data. The United Kingdom is expected to release its GDP, Manufacturing Production, Trade Balance, Industrial Production and Business Investment data at 10.30am that morning. The USA is expected to release its CPI data at 2.30pm. We are not expecting any earnings from the USA or locally.
We will be keeping tabs on the events in the markets. Check out our blog for market updates, insights from our GT247.com team, and our independent analysts. Not sure about a trade? Call the GT247.com Trading Desk on 087 940 6102, and bounce your idea off one of our dedicated traders.
Until next week, we wish you profitable trading!