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Week Ahead: hankering for a volatility-ending master plan
Our preview of the big financial events in the coming week.
That won’t stop the rumours and hypothesising over the coming weeks, which has made for volatile markets.
‘The guessing on the big master plan to be discussed at the EU summit at end-June will continue and we could see another week in which eurozone policymakers, directly or indirectly, could float various ideas,’ say ING Bank economists in a note.
Before the summit though, markets will get the results of the Greek election on 17 June. Over the coming week, as in the past week, Greece will remain in the shadows, owing to an opinion poll blackout ahead of the elections.
All of this uncertainty is keeping many individual investors on the sidelines. Citywire columnist Rob Kyprianou admits in his latest update – to be published on Citywire on Monday – that he is ‘scratching his head while sitting on the fence’.
In the absence of any major announcements, there is plenty of other data due in the coming week to shift markets.
China’s raft of economic data this weekend will set the tone for markets in the coming week. And following Thursday’s rate cuts, it isn’t expected to be pretty.
After Spain passed a test of market morale by successfully selling off government bonds last week, it’s now the turn of Greece, Germany and Austria.
In the UK chancellor George Osborne and Bank of England governor Mervyn King are both due to deliver speeches at the annual Mansion House dinner on Thursday. This is not an arena for making policy announcements, but their comments will be closely watched. Industrial production figures are also due on Tuesday for the UK, providing further clues as to the state of the UK's economic recovery.
And in the US, the strength of the economy in the face of the eurozone crisis will again be tested with retail sales (Wednesday), consumer sentiment data (Friday) and industrial production numbers (Friday) among the headline releases.
The eurozone also has industrial production figures due next week, on Wednesday, with inflation stats for the euro bloc due on Thursday.
Optimists might point to one event that could mean many Europeans simply won’t pay attention: the Euro 2012 football championships. ‘Volumes traded in a country’s stock market dropped 55% on average when that country’s team was playing a World Cup 2012 match,’ the ING eZonomics team reminded us this week.
It's supermarket reporting time on the FTSE 100. On Monday Tesco (TSCO.L) is due to deliver a trading statement.
More about this:
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- WM Morrison Supermarkets P L C (MRW.L)
- Kingfisher PLC (KGF.L)
- Tesco PLC (TSCO.L)
- Antofagasta PLC (ANTO.L)
- J Sainsbury PLC (SBRY.L)
- WPP PLC (WPP.L)
- Polymetal International PLC (POLYP.L)
- Eurasian Natural Resources Corp PLC (ENRC.L)
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