The coming week has the potential to be quite active for trading. Although Monday is a full holiday in the UK and a partial holiday in the US and Canada (government and banks are closed), the week could still get off to a busy start.
Sunday evening trading could be particularly active as traders get a longer opportunity to respond to the US consumer price inflation and retail sales reports that come out on the holiday Friday morning.
The main event Sunday evening is China Q1 GDP, retail sales and industrial production reports. This could have a significant impact on a number of markets including Asia Pacific indices, commodities and resource currencies.
Through much of the week, the economic calendar consists of middle tier and regional reports like the Fed’s Beige Book. Flash PMI is due toward the end of the week.
We may see more of a focus on individual stocks and sectors as earnings season in the US ramps up. Big bank reports continue but we also start to see numbers from big caps in the technology and industrials sectors. With President Trump struggling to get his economic program going, guidance may have a bigger impact on trading than the results unless there is a big surprise.
How the market reacts to reports could be particularly significant. Despite the recent pullback, major US indices are still trading well above where they were at the start of the last earnings season. This indicates expectations are still running very high. The reaction to the reports may indicate whether traders are still looking to chase markets and add to positions or if traders are looking for an excuse to take profits and run for the door.
The reaction to positive bank earnings last week was mixed with JPMorgan rallying but Citigroup sliding on the open. Reports that could provide important sentiment readings include Netflix Monday, IBM and Bank of America Tuesday, Travellers and Mattel Thursday and General Electric on Friday.
Politics may also continue to impact markets and could particularly influence swings
in and out of risk havens like gold, JPY and CHF. Syria/Russia and North Korea/China remain influential situations. The French election could impact trading as well, particularly in Euro pairs with four candidates in the running for two spots in the second round with first round elections coming up on Sunday the 23rd.
Economic news (North America time):
Good Friday US consumer prices and retail sales
Sunday Evening China GDP, retail sales, industrial production
Monday US Empire manufacturing
Tuesday US industrial production, housing starts
Tuesday evening Australia RBA minutes
Wednesday FOMC beige book
Wednesday evening Japan trade balance
Thursday US leading index
Thursday evening Japan flash PMI
Friday Flash PMI for US, Germany
UK retail sales
Canada consumer prices
Tuesday Bank of America
Wednesday Morgan Stanley
Friday General Electric