The coming week is full of traps and snares for investors in every market, be it equities, commodities or currencies.
After Friday night’s appalling US employment data for June and then the surge in Chinese inflation in June, brought forward to Saturday, markets will be on edge with confidence shaky.
For example we have more Chinese and US economic data, the start of the second quarter reporting season in America and interest rate decisions in Japan and South Korea, all this week.
New Zealand should also report its first quarter growth figures later in the week.
Of these, the Chinese economic figures and the US reporting season have the capacity to hit market sentiment hard.
The Chinese data will start appearing from Wednesday onwards after the inflation figures for June were rushed out to forestall leaks.
For example a bigger fall in Chinese second quarter growth or industrial production could make investors very nervy.
China releases its second-quarter growth figures on Wednesday, as well as June data for retail sales, fixed-asset investment and industrial output.
Economists at UBS have forecast that China’s second quarter GDP slowed to an annual growth rate of 9.5% from the previous year, or 8.8% from the previous quarter, as industrial production slowed.
Chinese manufacturing is slowing, but hopefully it’s approaching a trough and will rebound later on the year.
In Australia
The reaction to the carbon tax policy continues with market reaction to be assessed from today.
We also get the May housing finance and lending finance figures from the Australian Bureau of Statistics while the NAB’s monthly business conditions and confidence surveys are out tomorrow, with the Westpac/Melbourne Institute survey of consumer confidence issued on Wednesday.
The Reserve Bank will publish credit card lending data also on Wednesday.
There are quite a few company meetings (Annual and EGM) in Australia.
Utility, SP Austnet leads the way later in the week with its AGM.
Others include: CMA Corporation, Healthzone Ltd, Mamba Minerals, Newland Resources, PharmAust Ltd, Uramet Minerals, CiBio Ltd, Crescent Gold, Riedel Resources, IPGA Ltd, Quickflix Ltd and Red Emperor Resources.
NZ’s
First quarter data is due out Thursday after two previous scheduled releases were cancelled as the country’s statistics office grapples with the impact of the September and March earthquakes on growth and income (especially the way the reinsurance payments are accounted for).
In the US
We get the minutes of the Federal Reserve June 21-22 monetary policy-making meeting midweek.
That meeting saw the Fed’s growth forecasts for this year and next cut sharply.
We also will get June retail sales, June inflation readings from the producer price index and the consumer price index, industrial production and capacity utilization for June, and the preliminary July reading on consumer sentiment from the Thomson Reuters/University of Michigan Surveys of Consumers.
Quite a lot of data releases and each will be looked at closely for signs of the US economy slowing more steeply than shown by the June jobs data.
The US second quarter reporting season gets underway tonight, our time.
Aluminium company Alcoa unofficially starts the season with earnings announced early Tuesday morning, our time.
JPMorgan Chase will be the first of the big banks to report, with results due on Thursday and Citicorp reports on Friday night, our time.
Results from tech major Google also are expected Thursday.
Marketwatch pointed out that analysts surveyed by FactSet Research expect earnings for companies in the S&P 500 Index to increase 12.7% in the second quarter from the same quarter a year ago.
That’s down from the 19% growth in the first quarter, and down from an estimate at the end of June for a 14.2% growth rate.
Financial services companies such as banks have seen the biggest downward revisions in earnings estimates in the last 30 days, with banks taking some of the biggest hits, including Goldman Sachs and Morgan Stanley.
Marketwatch said US materials and energy sectors are expected to post the steepest growth rates, just as they did in the first quarter. Profits from materials-sector companies, which include miners and chemical firms, are expected to grow 48.2%.
Energy earnings should rise 35.2%. Both energy and materials-sector forecasts are slightly slower than first-quarter growth rates.
In Tokyo…
The Bank of Japan will announce its policy decision tomorrow at the end of its regular two-day meeting.
The bank will leave its key policy interest-rate range unchanged in a range of zero to 0.1%, and also stick to its basic assessment that the economy will return to a moderate recovery path later in the year.
But economists say it could cut its growth forecast for the current fiscal year that began in April, due to a technical adjustment to show the slump that followed the March 11 earthquake and tsunami.
The bank’s forecast now calls for growth of 0.6% this Japanese financial year.
The Bank of Korea
Releases its rate decision on Thursday, and economists are mixed as to what the bank will do in our third biggest export market.
South Korea’s consum
