A busy week in most major economies, with growth, inflation and earnings to dominate.
Inflation in Australia, economic growth numbers in the US, corporate earnings and meetings here, in the US and Europe, and central bank meetings in New Zealand and Japan.
As we have just read (above), inflation is the major report this week in Australia with the September quarter’s Producer Price Index out today and the Consumer Price Index on Wednesday.
They will set us up for the RBA meeting next Tuesday.
The central bank also releases private credit figures for September on Friday.
Data for new home sales and private sector credit will also be released, and a speech by RBA Assistant Governor Malcolm Edey will also be watched closely.
He’s in charge of the financial system and speaks on Wednesday.
It is the third major speech by a Reserve Bank official since October 15.
Several more are planned next month after the board meeting and around the release of the 4th state of monetary policy for the year.
The AGM season will also continue in Australia with Argo Investments, Bendigo Bank, Billabong, Bradken, Suncorp-Metway, Crane, Origin, Specialty Fashion Group, Hastie Group, Walter Diversified, Worleyparsons, Macarthur Coal, Boral, Crown, Investra, Noni-B, Macquarie Media Group, SuperCheap Auto, AGL, Toll, Healthscope, Crane, AGL, Lend Lease, Macquarie Infrastructure, Tatts Group and Wattyl amongst those due to meet.
The Macquarie Media and Macquarie Group meetings could see proposals to separate the funds from Macquarie Group, and or asset sales.
MIG’s second biggest shareholder, the Ontario Teachers Pension Plan bailed out of its 10% holding late last week at a 9% discount to the market. That has some analysts wondering if there is bad news ahead for the group at the AGM.
The major corporate event will be the ANZ Bank’s 2009 results released on Thursday and Macquarie Group’s interim results Friday.
Westpac and the NAB are due to report next week.
In the US GDP data is likely to confirm that the recession is over with annualized growth likely to have been 3% to 3.5% in the September quarter, following four quarters of contraction.
Thursday sees the first of three estimates of the September quarter’s GDP released.
A Reuters poll showed that economists and analysts reckon the economy grew at an annual rate of 3.2% in the quarter.
Figures for consumer confidence, durable goods orders, new home sales, personal income, and personal consumption will also be released.
Figures out last Friday showed sales of existing homes hit a 2 year high in September as the tax credit of $US8,000 drove sales. That, however, didn’t help the market which fell.
The US profit reporting season will remain a key focus for investors with energy, telecom and consumer goods companies in the spotlight.
So Visa (the credit card system), Corning, US Steel, Whirlpool, Kraft, Motorola, Proctor and Gamble, Colgate-Palmolive, Verizon (the phone co), Exxon and Chevron are amongst those due to report.
In addition, investors will watch the four Treasury auctions that will dominate the market’s landscape next week.
The US Treasury will sell $US123 billion of notes this week — a record.
Investors are again starting to fret that massive waves of government debt, intended to rescue financial companies and prop up the economy, could eventually endanger the US’ top level credit rating.
Reuters said that up till Friday, around 200 companies from the S&P 500 had reported third-quarter results, with Thomson Reuters data showing 81% beat forecasts.
Halloween is on Saturday.
Both the Reserve Bank of New Zealand and the Bank of Japan meet to discuss interest rates in the week ahead, but while both are likely to sound a bit more upbeat they are likely to leave rates on hold.
In Europe some global giants report: BP, ArcelorMittal (the world’s biggest steel group) , Deutsche Bank and Volkswagen are among companies scheduled to report results.
In Japan the first half (September) profit reporting season happens this week.
In fact, around 400 companies are due to report on Friday alone. Brokers say the figures should confirm a rebound in returns, especially in technology companies.
The results will include car giants like Honda, Toyota, multi nationals like Matsushita, Sony, Hitachi, NEC, banks, finance groups (which will be poor), steel and oil groups (both poor as well).
The big story will be the impact of the appreciating yen on sales and earnings and on second half guidance.
