CommSec Senior Economist Ryan Felsman previews the economic & financial market events scheduled for the week ahead including the CBA Business Sales Index, Skilled internet job vacancies & US Economic (GDP) growth.
Australia: Mid-winter lull
• The mid-winter lull in economic data continues in Australia. Skilled internet job vacancies figures are issued. The Commonwealth Bank releases its measure of economy-wide spending along with the ‘flash’ purchasing manager indexes. The gauges provide a health check on factory and services activity. Reserve Bank Governor Philip Lowe speaks at the annual Anika Foundation luncheon.
• The week kicks off on Monday when the Commonwealth Bank issues its Business Sales Index for June.
• On Tuesday the weekly series of consumer confidence will be released from Roy Morgan and ANZ.
• Also on Tuesday, the Reserve Bank’s Assistant Governor Christopher Kent, Assistant Governor (Financial Markets), provides a speech “The Committed Liquidity Facility” at The Bloomberg Address, Sydney at 8.30am AEST.
• On Wednesday, the Commonwealth Bank’s ‘flash’ services and manufacturing gauges for July are issued. Manufacturing and services sector activity expanded in June.
• Also on Wednesday, the Department of Employment releases the Internet Vacancy Index for June. In trend terms, the Internet Vacancy Index (IVI) fell by 0.7 per cent – the fifth consecutive monthly decline – to 81.1 points in May. The index is 5.7 per cent lower than a year ago – the biggest annual decline since December 2013.
• On Thursday, Reserve Bank Governor rounds-out the week with his annual speech at the The Anika Foundation Luncheon in Sydney at 1.05pm AEST. And the Bureau of Statistics issues detailed labour market data for June.
Overseas: US economic growth data in focus
• In the US, economic growth, housing and manufacturing data are amongst the highlights in the coming week. Durable goods orders data – a key measure of business investment – will also be closely scrutinised by economists for signs that companies haven’t frozen spending amid signs of a slowing US economy.
• The week begins on Monday in the US, when the influential Chicago Fed National Activity Index is issued.
• On Tuesday, the regular weekly reading on US chain store sales is scheduled, along with house prices, existing home sales and factory data from the Richmond Federal Reserve. Sales of previously owned homes rebounded in May to a 3-month high as all US regions gained amid lower mortgage rates and a still-supportive jobs market.
• On Wednesday, the weekly mortgage applications figures from the US Mortgage Bankers Association are due. New home sales declined sharply in May, led lower by a 35.9 per cent plunge in sales in the West – the least affordable of the four major US regions.
• Also on Wednesday, ‘flash’ IHS Markit purchasing managers’ manufacturing indexes are released for major developed economies, including the US, UK, Eurozone and Japan. Factory activity is contracting globally.
• On Thursday, the weekly figures on new claims for US unemployment insurance are issued, along with durable goods orders, wholesale inventories and factory activity data from the Kansas City Federal Reserve. Durable goods are expected to lift by 0.9 per cent in June after declining by 1.3 per cent in May. It was the third fall in orders in four months, held down by Boeing’s struggles with its suspended 737 Max jet.
• Also on Thursday, the goods trade balance is issued for June. Economists are forecasting a deficit of US$72.3 billion. The US merchandise-trade deficit widened in May to a five-month high amid a surge in imports following President Donald Trump’s decision to increase levies on US$200 billion worth of items from China.
• On Friday, June quarter US economic (GDP) growth data is issued. Annual GDP growth is forecast to decelerate from 3.1 per cent in the March quarter to 1.7 per cent in the June quarter. US Federal Reserve Chair Jerome Powell recently said that “crosscurrents”, such as trade tensions and concerns about global growth, have been weighing on US economic activity and the outlook.
• On Saturday in China, industrial profits data for June is scheduled.
US earnings season
• The US profit reporting (earnings) season continues in the coming week. S&P 500 companies are expected to report a 3 per cent fall in second quarter earnings growth according to FactSet data.
• Amongst companies reporting on Monday: Crane, Halliburton, Moelis, TD Ameritrade, Veritex, Whirlpool.
• Tuesday: 3M, Allegheny Technologies, Biogen, Corning, Harley-Davidson, Kimberly-Clark, Lockheed Martin, McDonald’s, Snap, Verizon Communications, Xerox.
• Wednesday: Advanced Micro Devices, AllianceBernstein, AT&T, Boeing, Callaway Golf, Caterpillar, Ford, Freeport-McMoRan, Hilton, Legg Mason, Tesla, Visa.
• Thursday: Alphabet, Amazon.com, American Airlines, Century Aluminium, Chipotle, ConcoPhillips, Expedia, Mattel.
• Friday: Cabot Oil & Gas, Colgate-Palmolive, Goodyear, Moody’s, Phillips 66, Piper Jaffray, Twitter, Weyerhaeuser.
Published by Ryan Felsman, Senior Economist, CommSec