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The UK, US and the Eurozone in the week ahead


A busy week for US earnings sees Netflix in the spotlight, while in the UK investors are facing jobs, inflation and retail sales data.

US: Time to subscribe to Netflix?

There’s not a whole lot of data for the US markets to sink their teeth into this week.

The existing home sales figures are joined by the usual jobless claims – which just fell to their lowest level since the pandemic struck the States – on Thursday before the flash manufacturing and services PMIs arrive on Friday.

It’s unclear whether that lack of action will impede the Dow Jones’s ability to hit new heights, or whether the relative quiet will allow a serious expedition above 34,000.

US: Stocks to Watch 

Much of the direction of the US markets is going to be dictated by the state of the ongoing earnings season. Coca-Cola reports on Monday, followed Procter & Gamble and, after their disappointing vaccine update, Johnson & Johnson on Tuesday. Verizon is then on Wednesday, while Intel, AT&T and Pfizer report on Thursday.

The undoubted highlight of the earnings calendar, however, is Netflix’s Q1 results on Tuesday.

Netflix’s fourth quarter update in January reflected the fact the streaming service is now the default entertainment provider for many households around the globe. Revenue rose 21.5% $6.64 billion, compared to estimates of $6.626 billion, while the company added 8.5 million net paid subscribers, more than 2 million above what was expected. That increase saw the firm finish 2020 with more than 200 million subscribers for the first time in its history, after hitting the 100 million mark in 2017.

Yet it didn’t knock every metric out of the park. At $1.19 per share, earnings fell significantly short of the $1.39 pencilled in by analysts.

With room for improvement, expectations are high for Q1. Luckily, Netflix has said it is heading for a record quarter in terms of revenue, up 23.6% year-on-year to $7.1 billion.

On a year-on-year basis the company’s own forecasts for net subscriber additions aren’t looking as strong. Netflix is aiming to add 6 million subscribers in Q1, compared to the staggering, covid-aided 15.8 million the same time the year previous.

And, after stating it was chasing an operating margin of 20% in FY 2021, up 2 percentage points from 2020, an update on profitability will be crucial on Tuesday.

Briefly spiking towards an all-time peak of $590 in the afterglow of its Q4 update in January, Netflix’s stock price has taken some hits since, at one point dropping under $500 in mid-March. It’s now moving between $540 and $560 and could be put back on the path to its record highs if all goes according to plan this week.

UK: Can the FTSE cross 7,000 mark?

The UK really takes the data-spotlight this week, which may or may not be good news for a FTSE looking to cross 7,000 and stay there.

Following a fairly disastrous claimant count change reading – of 86.6k against the 9.0k forecast – last month, that figure is going to be the focus of Tuesday’s jobs report.

Wednesday then brings the ominous question of rising inflation to UK shores, though with the monthly figure hovering around the half a percent mark, there isn’t necessarily anything to worry about just yet.

Friday, finally, brings the retail sales data for March, alongside the flash manufacturing and services PMIs for April.

UK: Stocks to Watch

As for the corporate side of things, Primark-owner AB Foods is up on Tuesday, with a mining hat-trick of Antofagasta, BHP Group and Rio Tinto on Wednesday followed by Anglo American, Rentokil Initial and Taylor Wimpey on Thursday.


The focus in the Eurozone this week will be Thursday’s ECB rate vote and subsequent press conference.

Before that, there is the region-wide current account number on Monday, German PPI on Tuesday, consumer confidence on Thursday and then, in the ECB aftermath, flash PMIs on Friday.

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This article is brought to you in association with Spreadex. All opinions expressed in this article are from the author and do not necessarily represent the opinions of The Armchair Trader. You can find out more about Spreadex products and services here, or find more articles from Connor Campbell here.

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