In a week that saw Gold break through $1300 an ounce and the beleaguered British pound post significant gains, an end to the US Government partial shutdown and some hope in US China trade talks, it’s small wonder that US equity indices closed out the week higher. The week of 28th January will be unusually rich for US data with key highlights being a Federal Open Market Committee interest rate decision, US GDP, US Consumer confidence numbers, US personal Consumption Expenditure, the Institute of Supply Management Manufacturing Index and also Non-Farm Payrolls employment data. We can also look forward to inflation numbers from Australia and the Eurozone, GDP from the Eurozone and Canada and also a UK Parliamentary debate on “BREXIT plan B.”
Tuesday sees the first key data announcement of the week and also the UK’s BREXIT debate. US Consumer Confidence (Jan) is expected to show a decline to 124 from 128.1. UK Prime Minister Theresa May is unlikely to have made much progress with her BREXIT deal and increasingly it looks like there will be calls for an extension in the timeline for negotiations.
The FOMC interest rate decsion is announced on Wednesday and US rates are likey to remain on hold at 2.5%. Fourth quarter GDP (Q/Q) precedes the FOMC announcement and is due to print 2.5%, showing that the US economy has slowed. ADP Non-Farm Payrolls, also out on Wednesday is expected to show jobs growth of 170,000 new jobs created. So expect a choppy day in both US equity indices and the US dollar on Wednesday! Other notable announcements on Wednesday are Australian 4th quarter CPI expected at 1.7% Y/Y. Australia posted a solid jobs report last week and the Australian dollar finished the week off strongly to close at AUDUSD 0.7190.
Eurozone GDP is the big announcement of Thursday and this is expected to fall to 1.2% Y/Y from 1.6%. In the afternoon Canada releases GDP numbers expected to show GDP at 2.2%Y/Y. US Core Personal Consumption expenditure will also be released, expected at 1.9% Y/Y for December.
The Eurozone awaits CPI on Friday expected at 1.4% Y/Y for January. In the afternoon, US Non-Farm Payrolls will be released expected to show 165,000 new jobs created. ISM Manufacturing PMI is due shortly afterwards, expected at 54.1 for January. The University of Michigan will release its Consumer sentiment Index expected to remain unchanged at 90.7 for January.
Of the US companies reporting quarterly earnings, four behemonths in Apple (Tuesday after market close), Facebook (Wednesday after market clsoe), Microsoft (Wednesday after market close) and Amazon (Thursday after market close) are all due to report this week. The results of these earnings can significantly impact US stock markets as a whole and so these announcements are well worth watching. Tesla (Wednesday after market close) also reports for those who enjoy the thrill of watching this company’s fortunes!
I believe we are truly set up for a tantilising trading week with endless intraday trading opportunities as well as receiving some timely and relevant longer term directional indicators on the US economy and World economy at large.
Watch out for me on video on Wednesday and Thursday. Good Luck and Good Trading. Ben Robson.
Ben Robson is the CEO of Spectrex Commodities and author of Currency Kings- How Billionaire Traders Made Their Fortune Trading Forex And How You can Too.