News flow this week should be a little slower than what we saw a week ago, but there will be enough to keep investors on their toes.
In Australia, tomorrow’s minutes from the RBA’s last board meeting are likely to confirm a basically neutral bias on interest rates, and discuss the housing boom and the central bank’s fears about rising consumer debt.
March housing finance data later today is expected to show a slight gain after falling in February, but the most important releases will be the March quarter wages price index showing no change in quarterly growth at 0.5%, and annual growth at a record low of 1.9%.
Before Thursday’s jobs data for April we get the monthly consumer confidence report from Westpac which will be watched for any boost from the Budget. Thursday’s jobs figures will also be closely examined after the big gain in March.
Thursday’s April employment data is expected to show a 5,000 gain after a massive rise in March with unemployment remaining around 5.9%, according to the AMP’s chief economist, Dr Shane Oliver.
Of considerable interest to Australia will be the release later today of Chinese economic activity data for April. Dr Oliver says that is expected to show a slight softening after recent strength as monetary policy tightening start to bring growth back into line with target.
He says we can expect to see growth in industrial production slow from 7.6% year on year to 7.1%, fixed asset investment slow to 9.1% (from 9.2%) but retail sales growth remain at 10.9%. The key figure will be real estate investment data.
In the US there’s mostly second and third tier data out this week – a home builders’ conditions index (tonight, our time), April housing starts, industrial production (both due Tuesday night).
New York and Philadelphia regional manufacturing conditions surveys will also be released during the week.
With more than 90% of the S&P 500 having reported quarterly results, the index is on track for earnings growth of 13.6% for the first quarter, the strongest increase since the third quarter of 2011, according to John Butters, senior earnings analyst at FactSet, the uS financial data company.
That growth number could get scaled back a bit, especially after in the past week. Many big retailers like Wal-Mart Stores, Target and Home Depot, Ross Stores TJX Cos (TJ Maxx, TK Maxx) have earnings reports in the coming week.
In Asia (apart from the Chinese data release today) the major bit of data will be Japanese GDP growth for the March quarter (out on Thursday). Dr Oliver says it is expected to show continued modest growth of 0.4% quarter on quarter or 1.8% year on year.
In Europe, Eurostat will release the second estimate of first-quarter GDP for the euro-area, which is widely expected to be unchanged at half a per cent.
