A busy week ahead with developments in the global trade war – President Trump’s increasingly erratic tweets will be watched because of the restarting of the Nafta trade talks with Canada and Mexico; US June quarter GDP, a meeting of the European Central Bank, inflation in Australia and an election in Pakistan.
As well investors have a lot of corporate earnings in the US, and the usual mid-month survey of business activity around the globe tomorrow night, our time.
The highlight of the US economic calendar is the first of three estimates of second quarter GDP due Friday.
Economists expect it to be boosted from 2% annual in the first quarter to 4.2% in the three months to June by renewed momentum in consumer spending, growth in capital expenditures (which however is now slowing) and a net boost from trade.
Investors will get updates on the health of the US housing market through existing and new home sales data, the US consumer and trade.
On the political front Nafta talks resume following a two-month break.“So far, only bilateral talks are scheduled but Canada and Mexico still favour a trilateral deal despite Trump’s desire for bilateral deals with each country.
The European Central Bank (ECB), which last month said it will phase out its stimulus program by year-end, is expected to leave rates unchanged when it delivers its monetary policy decision on Thursday night, our time.
The Financial Times says “ECB head Mario Draghi could address the ongoing trade spat and its possible impact on both European and global growth during his press briefing.
June quarter GDP data for France and South Korea are also due to be released this week.
Pakistan hold national elections on Wednesday that are considered to be the grubbiest for years. Former cricketer Imran Khan has made some headway in the polls, while former prime minister Nawaz Sharif returned to the country from exile and was arrested earlier this month to begin a 10-year sentence for a corruption conviction.
“The Pakistan Muslim League-Nawaz (PML-N) is considered one of two parties most likely to win the election, with the other being Pakistan Tehreek-e-Insaf (PTI), led by Mr Khan,” The Financial Times forecast at the weekend.
Investors will also get updates on the health of the US housing market through existing and new home sales data and durable goods sales.
And more than 170 S&P 500 companies are down to report quarterly earnings this week.
The highlights will be those from Alphabet (Google) tonight and Facebook on Wednesday and Amazon on Thursday, US time.
In Australia, the Consumer Price Index for the June quarter is out on Wednesday. He says underlying inflation will be around 0.5% and an annual 1.9%.
He wrote at the weekend this will show “inflation remaining at or around the low end of the RBA’s 2-3% target range, consistent with official interest rates remaining on hold for an extended period.”
There are a couple of June 30 full year reports tghis week from Australian Foundation Investment Co and the small industrial group, GUD Holdings. A few quarterly and yearly production sales from small to medIum miners will also be issued.
Watch especially for a statement from Perth-based MIResources. Its shares were suddenly suspended at the company’s request on Friday with an announcement promised by tomorrow. The shares had a late surge in trading on Thursday that has not been explained.
