4 Key Events To Focus On This Week

From central bank comments and key economic indicators to eagerly anticipated corporate earnings reports, every announcement holds the promise of impacting global economies and guiding strategic investment decisions over the short and longer term.

Whether you’re an investor seeking long-term growth or a trader capitalizing on short-term market movements, staying informed about these events is important to take advantage of new opportunities and better protect your positions. Let’s have a look at events that are set to exert influence on the financial landscape in the coming days, providing investors and traders with insights to navigate and respond effectively to the evolving market scenario.

PMI figures in Europe and in the United States

According to the latest monthly PMI bulletin from S&P Global, global growth has been accelerating in December at its quickest pace since August 2023, but divergences appeared between sectors and regions showing that the recovery from Covid-19 and higher interest rates hasn’t been even.

Emerging economies seem to be stronger than developed markets that have been in contraction over the last 5 or 6 months, and the manufacturing sector has been a drag on the economy compared to the service sector.

Additionally, inflation persisted at elevated levels when benchmarked against “historical standards.” PMI price indicators revealed that selling price inflation held steady in December, maintaining a range between 53.0 and 53.7 over the past seven months. Among the key factors contributing to upward price pressure, labor costs, particularly wage-push price hikes, were identified as the most significant, along with increased shipping costs and stronger demand.

On Wednesday 24th between 8:15 AM GMT and 9:30 AM GMT for France, Germany, the Euro Zone and the United Kingdom, as well as at 2:45 PM GMT for the United States. The level of inflation and output, as well as shipping costs and comments on supply chain issues will be closely followed by market participants.

Comments From the ECB During the First Monetary Policy of The Year

Recently, Christine Lagarde, the head of the European Central Bank (ECB), stated that a rate cut could be a possibility in the second half of the year if the data received in the meantime indicates a sustainable movement from inflation towards the 2% target.

However, she emphasized the significance of market participants avoiding excessive optimism, as premature rate cuts could undermine the efforts and progress made by the ECB in combating inflation in the Euro Zone, as some market expectations for rate cuts will come as soon as April.

While the majority of investors anticipate that the ECB will maintain unchanged rates in its upcoming meeting on January 25th, every statement will be carefully examined by investors seeking additional insights into the potential timing of rate cuts. Given the acknowledgment by ECB officials that interest rates have reached their peak, analysts are anticipating additional guidance during the ECB’s press conference scheduled for 14:45.

PCE Inflation Figures

As explained by the Bureau of Economic Analysis, the PCE or Personal Consumption Expenditure is “a measure of the prices that people living in the United States, or those buying on their behalf, pay for goods and services”. Therefore, this index is useful in determining inflationary or deflationary pressures “across a wide range of consumer expenses and reflecting changes in consumer behavior”.

The data scheduled for release on Friday, 26th at 1:30 PM GMT for December is anticipated to reveal a Core PCE number, excluding volatile components like food and energy, with an expected slightly increase to 0.2%. In the preceding months of October and November, the Federal Reserve’s preferred inflation measure recorded a 0.1% increase month over month.

Important Earnings to Follow

This week, key companies in the Technology, Financial, Consumer Goods, and Consumer Services sectors are set to release their earnings reports for the last quarter. It’s essential to note that the earnings season serves as a crucial period for investors to evaluate a company’s recent performance.

During this period, investors decide whether to keep a company in their portfolio, sell its shares, or incorporate it into their investment strategy.

Earnings releases to follow on Tuesday 23rd:

• 3M
• General Electric
• Halliburton
• Netflix
• Procter & Gamble

Earnings releases to follow on Wednesday 24th:

• AT&T
• IBM
• Louis Vuitton
• SAP
• Tesla

Earnings releases to follow on Thursday 25th:

• Christian Dior
• Intel
• Starbucks
• STMicroelectronics
• T-Mobile
• Visa

Earnings releases to follow on Friday 26th:

• American Express
• Caterpillar
• Colgate-Palmolive
• Rémy Cointreau

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