In the week ahead, investors have a lot to digest. There's ongoing conflict in the Middle East, Australian job data, remarks from the new Reserve Bank chief, a speech by Fed Chair Jay Powell, and US retail sales figures. Additionally, there's the aftermath of the Voice referendum loss in Australia, the NZ elections and a change in government, China's latest economic data, and GDP figures for the September quarter, along with the Polish parliamentary elections and quarterly reports from around the world.
Australia's labor force data for September, expected on Thursday, is anticipated to reveal a slight increase in new jobs, with AMP's chief economist, Shane Oliver, predicting 5,000 new jobs and a jobless rate rise to 3.8%. August saw an unexpected surge of 64,900 new positions.
On Tuesday, the minutes from the last RBA meeting will be released, shedding light on the first meeting overseen by the new Governor, Michell Bullock, who will also participate in a 'fireside chat' at a finance conference on Wednesday.
Several resource companies, led by Rio Tinto (today) and BHP (Thursday), will release quarterly reports this week. The fate of Albemarle's $3 per share offer for Liontown Resources should become clear during the week, and the substantial Newmont all-paper offer for Newcrest is moving toward its endgame.
In the US, September retail sales (Tuesday) are expected to have slowed to just 0.2% month-on-month growth, with high petrol prices likely having an impact. Industrial production is forecasted to fall 0.1%, and while October home builder conditions remain subdued, housing starts (Wednesday) are expected to bounce by 10% after a sharp fall in August. Existing home sales (Thursday) are expected to decline by another 3.5%.
Manufacturing conditions in the New York (Monday) and Philadelphia (Thursday) regions for October are likely to be soft. US September quarter earnings results will step up, with around 50 companies with a market value of $US50 billion or more due to report. Notably, watch for reports from Netflix and Tesla on Thursday morning.
Durable consumer spending has been a key factor in the economy's resilience despite higher interest rates, supporting stocks this year. The S&P 500 is up about 13% year-to-date, though it has retreated roughly 6% from highs reached in late July as bond yields have risen and the US dollar has firmed.
Dr. Oliver notes that there are several September inflation data releases this week for various countries, expected to show slight falls: Canada (Tuesday) slowing to 3.8% yoy, New Zealand (also Tuesday) slowing to 5.9% yoy, the UK (Wednesday) slowing to 6.2% yoy, and Japan (Friday) slowing to 3% yoy.
Following weak inflation and trade data, China's economic health takes center stage on Wednesday. Shane Oliver from AMP expects China's September quarter GDP growth data to show a further slowdown in 12-month ended growth to 4.5% yoy from 6.3% yoy, as the reopening bounce from a year ago drops out. However, quarterly growth is expected to improve to 1% qoq from 0.8% qoq. September monthly data is expected to show an improvement in growth for retail sales to 4.8% yoy, a slowing in industrial production to 4.3% yoy, and unchanged investment at 3.2% yoy.
"Overall, this should help allay concerns about a collapse in Chinese growth, albeit it's still soft by Chinese standards," Dr. Oliver wrote over the weekend.
