Market commentary: Markets await release of financial data

It’s a fairly busy calendar for us to look forward to in the finance world as earnings season picks up the pace in the US, Greece remains in the headlines and a G20 finance ministers meeting on Thursday mark the non-data related highlights.

On the data front, today the UK CPI/PPI/RPI readings for March will be released at around 10.30am where the market is expecting the headline inflation reading to stay low. Inflation data out of Italy is also due while industrial production for the Euro-area is scheduled.

In the US, March retail sales are the highlight while PPI (purchasing power index), and business inventories are all expected to add fuel to the speculation as to when the Fed will commence to raise interest rates. A set of mixed results will result in adding to an already relatively volatile period.

China on Wednesday announces retail sales, industrial production, fixed assets and most importantly Q1 GDP figures. In Japan industrial production and capacity utilization are expected. Inflation data will be the highlight in the Europe with the final March CPI reading for Germany due as well as the preliminary number in France. The ECB meeting is also due to take place as well as the February trade data for the region.

In the US on Wednesday we’ve got industrial production, empire manufacturing, capacity utilization, manufacturing production, NAHB housing market index and the release of the Fed’s Beige Book all due. There is little in way of data in the Asia or Europe time zones on Thursday, however in the US we’ve got housing starts, building permits, jobless claims and the Philadelphia Fed business outlook all due.

We round off the week on Friday in Europe with the final March CPI reading for the Euro area as well as employment indicators out of the UK. Inflation data will be the highlight over the in the US meanwhile with market consensus for a +0.1% yoy core. Average weekly earnings, leading index and University of Michigan consumer sentiment print round off the week’s prints.

Earnings Season

The big talking point over the full season will be how much the dollar is impacting results and whether we'll get an earnings recession. Out of the 24 companies to have reported so far in the S&P 500, 16 have cited some sort of negative impact or sentiment towards the strong Dollar in their Q1 earnings transcripts so far.

There’s talk that banks may surprise to the upside in this earnings season (JP Morgan and Wells Fargo report on Tuesday, Bank of America on Wednesday, Citigroup and Goldman Sachs on Thursday) this week and these might out-perform given supportive financial market conditions so far in 2015.

UK inflation is expected to be a headline this week with the possibility of the first YoY deflation since 1960. With 10 year bond yields closing at 0.153% last week and so much debate about the Fed's plans in 2015 inflation numbers from all of the major economies are going to be very important over the coming months.

Greece will likely continue to be front and centre for the coming weeks as markets hope to see some progress over its structural reform measures.

This article was issued by Simon Psaila Trader/Analyst at Calamatta Cuschieri. For more information visit, www.cc.com.mt . The information, view and opinions provided in this article is being provided solely for educational and informational purposes and should not be construed as investment advice, advice concerning particular investments or investment decisions, or tax or legal advice. Calamatta Cuschieri & Co. Ltd has not verified and consequently neither warrants the accuracy nor the veracity of any information, views or opinions appearing on this website.

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