Major economic releases will give investors plenty of new data to parse this week.
United States
US shares closed slightly lower on the negative side of no change. The Dow Jones industrials were down 0.1 percent while both the S&P (down 0.91 point) and Nasdaq (down 2.25 points) slipped. On the week, the Dow was 0.3 percent lower while the S&P and Nasdaq added 0.5 percent and 1.2 percent respectively.
Weak earnings from General Electric weighed on the Dow, while tech shares retreated from record highs and energy shares tracked lower oil prices. GE declined hitting its lowest level since October 2015. The company reported a nearly 60 percent slump in profit and said its full year profit and cash flow will be at the low end of its forecasts. Caterpillar and 3M fell. But Honeywell touched a record high after it raised the low-end of its profit forecast. Microsoft declined despite strong earnings after the bell Thursday thanks in large part to its fast growing cloud computing business.
Capital One advanced after it beat expectations helped by growth in card loans and net interest income. Visa rose after it raised its annual earnings forecast. Shares in eBay were down after the company reported earnings that were largely in line with expectations.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was up US$9.85 to US$1,248.55. Copper futures were up 0.2 percent to US$2.72. WTI spot crude was down US$1.15 to US$45.77. Dated Brent spot crude was down US$1.24 to US$48.06. The US dollar was down against the yen, euro, pound, Swiss franc and the Canadian dollar. The currency was up against the Australian dollar. The Dollar Index was down 0.3 percent. The yields on both the US Treasury 30 year bond and the 10 year note were down 2 basis points to 2.81 percent and 2.24 percent respectively.
Europe
The European markets retreated solidly across the board. The markets were little changed during the first few hours of the day, before turning to the downside. The continued strengthening of the euro against the US dollar weighed on the European markets during the week, as the currency reached almost a 23-month high against the US currency on Friday. The FTSE was down 0.5 percent, the CAC lost 1.6 percent, the DAX dropped 1.7 percent and the SMI was 1.0 percent lower. On the week, only the FTSE gained — the index was up 1.0 percent. The CAC, DAX and SMI were down 2.2 percent, 3.1 percent and1.1 percent respectively. The pullback in crude oil prices had a negative impact on investor sentiment, prior to a closely-watched OPEC meeting on Monday.
The International Monetary Fund on Thursday approved “in principle” a new loan worth $1.8 billion to Greece. However, the arrangement has been approved in principle, which means it will become effective only after IMF receives specific and credible assurances from Greece’s European partners to ensure debt sustainability. Then a second executive board decision is needed to make the arrangement effective.
Telefonica Deutschland slipped after naming its new CFO. Valeo dropped after its first half sales and earnings narrowly missed estimates. Vodafone Group climbed after it reported better-than-expected revenue growth in its first quarter, thanks to a robust commercial momentum in Europe. Paysafe Group jumped after it received a conditional offer worth $3.71 billion from Blackstone Group LP and CVC Capital Partners.
Asia Pacific
Most Asian stocks declined Friday after the European Central Bank did not drop any hints at tapering in September and media reports suggested that US special counsel Robert Mueller is expanding the Russia probe. The euro held near two-year highs against the US dollar after ECB President Mario Draghi said the governing council would discuss possible changes to the central bank’s bond-buying program in the autumn. The Japanese yen rose against the dollar and gold remained on track for a second straight weekly gain while oil held steady ahead of a key meeting of major oil producing nations next week.
The Shanghai Composite was down 0.2 percent but ended the week up by 0.5 percent on optimism about economic growth. The Hang Seng slipped 0.1 percent on the day and was up 1.2 percent on the week.
Both the Nikkei and Topix lost 0.2 percent Friday. The Nikkei slipped 0.1 percent on the week while the Topix added 0.3 percent. Exporters declined thanks to yen strength on lingering concerns over the US administration’s economic agenda. Automakers Honda Motor, Mazda, Nissan and Toyota dropped. Banks Mitsubishi UFJ Financial, Mizuho Financial and Sumitomo Mitsui Financial retreated after the yields on 10-year US Treasuries dropped to its lowest level in three weeks. Canon on a Nikkei report that its consolidated operating profit for the year ending December is likely to jump 40 percent to ¥330 billion compared with the company’s expectations of ¥270 billion. Yaskawa Electric soared on strong earnings results.
The S&P/ASX was down 0.7 percent and the All Ordinaries was down 0.6 percent. The big four banks declined after two sessions of strong gains. BHP Billiton and Rio Tinto declined after iron ore prices tumbled overnight. Fortescue Metals Group declined after an unfavorable court ruling over indigenous land rights. Energy stocks also closed broadly lower. For the week, the S&P/ASX was down 0.7 percent and the All Ordinaries lost 0.6 percent.
The Kospi gained 0.3 percent and 1.5 percent on the week. The Sensex added 0.4 percent Friday but was virtually unchanged (8.14 points) on the week.
Looking forward

Central Bank activities

July 26

United States

FOMC Monetary Policy Announcement

The following indicators will be released this week…

Europe

July 24

Eurozone

Manufacturing, Services & Composite PMI (July flash)

Germany

Manufacturing, Services & Composite PMI (July flash)

France

Manufacturing, Services & Composite PMI (July flash)

July 25

Germany

Ifo Business Survey (July)

July 26

UK

Gross Domestic Product (Q2.2017 first estimate)

July 27

Eurozone

M3 Money Supply (June)

July 28

Eurozone

EC Consumer & Business Confidence (July)

France

Gross Domestic Product (Q2.2017 flash)

Consumption of Manufactured Goods (June)

Asia

July 24

Japan

Manufacturing PMI (July flash)

July 26

Australia

Consumer Price Index (Q2.2017)

July 28

Japan

Household Spending (June)

Unemployment (June)

Consumer Price Index (June)

Retail Sales (June)

Americas

July 24

United States

Manufacturing PMI (July flash)

Existing Home Sales (June)

July 25

United States

Consumer Confidence (July)

July 26

United States

New Homes Sales (July)

July 27

United States

Initial Unemployment Claims (week ending prior Saturday)

Durable Goods Orders (June)

International Trade in Goods (June)

July 28

United States

Gross Domestic Product (Q2.2017 advance)

Consumer Sentiment (July final)

Canada

Monthly Gross Domestic Product (May)

Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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