Another big week ahead for Australia, with key economic data from China, the Reserve Bank minutes, and the interim report of the inquiry into the financial system chaired by former Commonwealth Bank boss David Murray.
Offshore there’s the US quarterly earnings rush, as well as two speeches by Fed chair, Janet Yellen.
In Australia, the RBA board minutes tomorrow and the Chinese growth and other economic data on Wednesday will be watched closely in Australia, as usual, and by traders in the Aussie dollar.
China’s June and June quarter growth, industrial production, urban investment, new bank lending and retail sales will be released on Wednesday.
Growth could be in the range of 7.4% to 7.6% (annual), while industrial production might be up a touch, likewise retail sales, and urban investment might be steady to a touch weaker as the housing sector continues to cool.
As well, house price data from China could be out late in the week (as well as bank lending data) and both will also be closely watched to see if the emerging slide continued in June – which it almost certainly did.
All this will confirm an economy, like ours, which is still growing, but doing so sluggishly.
Meanwhile, tomorrow’s minutes from the last RBA Board meeting are likely to confirm, once again, the dovish bias on interest rates seen in the post-meeting statement consistent with the more dovish tone seen in the previous minutes and in Governor Glenn Steven’s recent speech.
Data for dwelling starts on Wednesday will likely show a further rise.
Car sales figures for June and lending finance figures are out today and tomorrow.
The major non-economic event is the release of the interim report of the financial inquiry chaired by David Murray. It will be released at 8am on Tuesday.
The report will lay out the key issues identified by the inquiry from the submissions lodged with it, plus discussions with various parties here and offshore.
It’s only a preliminary report but shareholders in the banks (many of us) and insurers and other financial firms should be alert to its contents.
The major corporate event this week happens today with David Jones shareholders to vote on South Africa’s Woolworths’ takeover offer in Sydney at 10am.
Major quarterly, half year or full year production reports will be released by Rio Tinto, Whitehaven Coal, Woodside, Santos, Fortescue and OZ Minerals. SP Ausnet holds its AGM on Thursday.
In the US, the second week of the June 30 quarterly reporting season, plus a key focus will be Fed Chair Janet Yellen’s Congressional testimony starting Tuesday will dominate.
Ms Yellen’s testimony to the House of Representatives, and then the Senate, won’t waver much from the message following the June Fed meeting (and the minutes released last week) which was that the US economy is improving allowing the Fed to end its tapering in October.
But there won’t be any clarification on the timing of an interest rate rise because the Fed still sees slack in the US economy.
Inflation might be discussed, but the Fed regards the recent rise as "noise".
On the data front, expect a solid 0.6% gain in June retail sales, an 0.3% rise in June industrial production on Wednesday, a further rise in the NAHB homebuilders conditions index (also on Wednesday) and gains in housing starts and permits (Thursday). Producer price inflation data will also be released.
The US June quarter earnings reporting season hots up this week.
The AMP’s Chief Economist Dr Shane Oliver says the consensus is for earnings growth of 6% year on year and sales growth of 3%.
"Given the downgrade from 8% three months ago and a high level of negative profit warnings it’s likely that earnings growth will come in stronger than this," he wrote at the weekend.
Among the US companies reporting this week are giant banks JPMorgan Chase, Goldman Sachs, Bank of America, PNC, Citigroup, and Morgan Stanley; healthcare giants Johnson and Johnson, Abbott Labs and Novartis; computer chip makers Intel and its rival AMD; hard drive maker Seagate; tech giants eBay, Yahoo, Google, IBM and SAP; the huge global investor Blackrock; car retailer Auto Nation; fast food giant Yum Brands; manufacturers Honyewell, Textron and the massive General Electric; toy group Mattel; and energy services group Schlumberger.
In Canada, the country’s central bank releases its decision on interest rates on Thursday night, our time.
In Asia, the Chinese data on Wednesday will dominate.
Revised industrial production figures for Japan for May will be out on Tuesday.
Wednesday also sees the Bank of Japan issue its monthly report. Trade figures for May are out in Japan on Thursday.
In Europe, industrial production figures for May for various countries and for the eurozone as a whole will be released tonight, our time.
Retail sales figures are out in the UK tomorrow night, economic sentiment survey details for Germany and the euro area are also out tomorrow night.
Also on Wednesday the trade data for the eurozone for May will be released.
