It could be a China-focused week for the markets, while investors would also do well to keep an eye on the number of new daily covid-19 cases in a stricken United States.
US: Chinese data to offer clues on global recovery
Like the rest of the markets, the US trading week may be built around Thursday’s high profile Chinese data dump.
From the pre-pandemic forecasts of a 6% expansion – a number that no doubt would’ve disappointed investors in normal circumstances – to expectations of a 6.2% contraction, to the reveal that the country had suffered a worse than expected 6.8% collapse, the first quarter was a tough one for the Chinese economy.
Ahead of the West in terms of its coronavirus timeline, Thursday’s second quarter GDP could now give the US and Europe an idea of what kind of rebound is possible in Q3, even if the varying degrees of lockdown across those regions makes a like-for-like comparison tricky.
Analysts are expecting an expansion of 1.1% for the April to June period, though that’s an average – the range of predictions is anywhere between -5.2% and +3.6%.
Alongside the GDP figures come the monthly fixed asset investment and industrial production readings for June, with May’s -6.3% and 4.4% the numbers to beat.
Domestically, the Dow Jones may have no choice but to focus on America’s ever-growing number of daily covid-19 cases, which is now regularly topping 60,000.
There’s also a fair amount of US data to get through, including inflation on Tuesday, industrial production on Wednesday, retail sales and jobless claims on Thursday, and building permits, housing starts and consumer confidence on Friday.
UK: Economic readings to set tone
While the FTSE, with its mega-commodity sector, will no doubt be hugely invested in China’s GDP reading, the UK itself has plenty to sink its teeth into.
Tuesday brings with it the latest industrial production, manufacturing production and GDP figures, the latter coming after last month’s 20.4% contraction.
Inflation on Wednesday is then looking to beat the previous month’s 0.5%, a level last seen in the aftermath of the Brexit referendum result.
Thursday, finally, sees the UK jobs report. The average earnings index and unemployment rate numbers will be from May, while the claimant count change reading will cover June.
UK: Stocks to Watch
In terms of the corporate calendar, there’s Centamin on Monday, lockdown-favourite Ocado on Tuesday, Burberry on Wednesday, and Hays and SSE on Thursday.
There Eurozone itself is no slouch this week, bringing plenty to the table, including Thursday’s ECB rate vote and subsequent press conference.
Beyond the latest appearance from Christine Lagarde, there are the industrial production and ZEW economic sentiment readings on Tuesday, the region-wide trade balance number on Thursday, and the inflation figures on Friday.
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