CFDer er komplekse finansielle instrumenter og investeringer i disse innebærer høy risiko for å tape penger raskt, grunnet gearing. 72% av ikke-profesjonelle kunder taper penger når de handler i slike produkter med denne tilbyderen. Du bør vurdere om du forstår hvordan CFDer fungerer og om du har råd til å ta den høye risikoen for å tape pengene dine.
Market outlook

The Week Ahead: UK inflation; China GDP; Deliveroo, Netflix results

Read our pick of the top stories to look out for in the week commencing 17 January 2022, and view our key company earnings schedule.


China Q4 GDP – Monday

China’s economy was initially expected to grow 6% in 2021, in line with the government’s annual growth target. This seemed a conservative estimate a year ago, but by last autumn it appeared somewhat optimistic. In Q1 China’s GDP grew 0.4% on a quarterly basis, and 18.3% compared to a year earlier. Then, in Q2, quarterly growth increased to 1.3%, though annual growth slowed to 7.9%. However, in Q3 quarterly economic growth almost ground to a halt, partly because of Covid, with GDP rising just 0.2%, missing expectations of 0.4%. Other factors behind the quarterly growth slowdown included supply chain issues, delays at ports, surging energy costs, and power cuts that shut down factories and businesses. On top of all that, government-led crackdowns on various parts of the economy, and the Evergrande crisis, also weighed on growth. Economic performance in Q4 is expected to have improved, but the government’s zero-Covid policy continued to limit economic activity. Incidentally, that policy seems doomed to fail, given the rapid spread of the Omicron variant. Upcoming Q4 GDP figures are expected to show quarterly uptick of 1.2%, driven by export growth, but on an annual basis the 6% target is likely to be missed, with consensus estimates putting year-on-year growth in Q4 at 4.9%.  

UK inflation (December) – Wednesday

The Bank of England surprised the markets in December by raising interest rates from 0.1% to 0.25% in a move that most economists had expected a month earlier. The rate hike came after inflation soared to 10-year high. The Consumer Prices Index (CPI) rose by a larger-than-expected 5.1% in the 12 months to November, up from 4.2% in October. Meanwhile, the Retail Prices Index (RPI), another measure of inflation, hit a 30-year high of 7.1%. The central bank’s indecision over raising rates has led to speculation that we could see another rate rise in February, particularly since inflationary pressures are likely to intensify in the weeks and months ahead. Prices for domestic producers have been rising even more rapidly than consumer prices, with the Producer Price Index (PPI) indicating that input prices rose 14.3% in the year to November. This suggests that inflation could move even higher, perhaps surpassing 2008 levels, when CPI hit 5.2%, and possibly moving towards highs last seen in March 1992, when CPI reached 7.1%. Bank of England governor Andrew Bailey has already said that he expects CPI to hit 6% in the coming months, which is well above the central bank’s 2% inflation target. A further increase in headline CPI on Wednesday will increase the pressure on the bank’s Monetary Policy Committee to act on rates again in February. While some are arguing that another rate rise will do little to tame inflation, that shouldn’t preclude the central bank from attempting to normalise policy. The mistake would be not to tighten monetary policy at all, or to tighten too aggressively. Consensus estimates suggest that CPI rose 5.3% in the year to December.  

Deliveroo Q4 results – Thursday

Deliveroo’s stock market debut on 31 March last year went down as a disaster, with the Financial Times calling it “the worst IPO in London’s history”. On their first day of trading, Deliveroo’s shares closed 26% below their listing price of 390p. After clawing their way back to 396.80p in August, the shares have fallen to record lows, closing at 177.50p on 13 January. At present, there is little sign that investors are about to rediscover their faith in the business, despite forecasts of revenue growth. In 2020 Deliveroo generated £1.2bn in revenue, and the company appeared to be on course to beat that in 2021. Consensus estimates are for full-year revenue to grow 56% to £1.9bn. In Q3 Deliveroo raised its guidance, saying full-year revenue would grow 60-70%, leaving estimates for gross profit margins unchanged at 7.5-7.75%. Yet despite these predictions and new delivery tie-ups, the shares have continued to struggle. Deliveroo has seen orders surge thanks to its deals with Amazon and Morrisons, but strong competition in the food delivery market and falls in the share prices of its nearest competitors have dampened sentiment. In August German rival Delivery Hero bought a 5% stake in Deliveroo and now probably wishes it hadn’t, given the stock’s sharp decline in recent months. On top of this, a key concern for investors now is rising costs, as inflation edges higher and workers expect pay rises. As investors await the company’s Q4 update, many will be hoping that the ongoing pandemic and official advice to limit contact with others in December led to an increase in Deliveroo orders, potentially boosting the company’s Q4 numbers. But will that be enough to lift Deliveroo’s share price? 



China retail sales (December)

China’s zero-Covid policy appears to be harming consumer confidence and spending patterns, as retail sales growth has slowed sharply since July. The latest figures show that retail sales grew 3.9% in the year to November, representing a slowdown from 4.9% in October. This was especially disappointing given that it covered “Singles Day”, an annual shopping campaign that takes place on 11 November, when retailers usually cash in. It seems that Chinese consumers remain cautious amid concerns over Covid outbreaks and inflation. With Omicron becoming the dominant global strain, this caution is likely to persist in the near term. Retail sales growth may therefore remain weak in December, with forecasts pointing to a rise of 3.8%. In better news for China’s economy, industrial production is recovering from the factory shutdowns in September. Though growth in industrial output remains lower than the annual increase of 6.7% recorded in July, the numbers have picked up since the low of 3.1% in September. Industrial output grew 3.8% in the year to November, and we’re expecting growth to remain at about 3.8% in December.


UK unemployment (November)

The Office for National Statistics (ONS) reported that the UK’s unemployment rate – as measured by the labour force survey and based on the International Labour Organisation’s (ILO) definition of unemployment – fell to 4.2% in the three months to the end of October, down from 4.3% in the three months to the end of September. That put UK unemployment at a 15-month low. In addition, the number of UK workers on payrolls rose by 0.9%, or 257,000, between October and November to 29.4m, according to the ONS, while the number of vacancies increased to 1.22m. The trends seem likely to continue. While average weekly earnings grew 4.3% year-on-year in the three months to October, down from 6% in the previous three-month period, it’s unlikely that earnings growth will slow much further, given the number of vacancies available. In recent weeks, Next and Sainsbury’s have announced wage rises in line with current inflation levels, and they are unlikely to be the only ones as their rivals look to match them in order to keep staff. The ILO measure of UK unemployment for the three months to the end of November is expected to come in at 4.1%. 

Goldman Sachs Q4 results

US banks set aside billions of dollars in 2020 to cover possible loan defaults during the pandemic. However, these defaults didn't materialise – at least not on the scale that the banks had feared. So, in 2021, the banks began drip-feeding their emergency cash stockpiles back onto their balance sheets, boosting profits and making 2021 a blue riband year for the banks. In Q3 revenue came in at $13.61bn, exceeding expectations by $2bn, while profits rose to $14.93 a share, smashing consensus estimates of $9.92. There were revenue beats in all divisions, with the trading division standing out as it notched up revenue of $5.61bn. Equities also outperformed, with revenue of $3.1bn, against expectations of $2.2bn. Goldman also seems to have a better handle on costs than its its competitors, partly because it is not a consumer bank and doesn’t have a network of bank branches to maintain. Q4 profits are expected to come in lower than in recent quarters at $11.60 a share. Despite the bank’s astonishing results of late, its shares are down just over 3% in the last year. This may be due to concerns that banks could struggle to sustain the outperformance we have seen in the last 12 months, as the prospect of higher interest rates tempers economic growth expectations and lending activity. 


JD Wetherspoon Q2 results

Pubs have borne the brunt of Covid restrictions in the past two years, as customers have been either shut out completely or allowed to enter in only limited numbers. The UK government’s implementation of “Plan B” in December – a crucial month for the hospitality industry – unleashed a firestorm of criticism. The widely reported cancellation of bookings and parties in the runup to Christmas is likely to have hit the industry hard. It came after Wetherspoon posted a record loss of £154.7m in October, as Q1 revenue fell to £772.6m, down roughly 40% from £1.26bn in 2020, and down almost 60% from £1.8bn in 2019. The pub chain reported an 8.9% decline in sales compared to the same quarter a year ago. The Wetherspoons-owned Lloyds brand of bars, which appeal to a younger cohort, performed well, except in London. Expectations are low ahead of this Wednesday’s numbers, as Wetherspoons issued a trading update in December warning that it could post a half-year loss.   


EU inflation (December)

The European Central Bank’s insistence that it won’t raise interest rates in 2022 is likely to continue to face challenges from within the Governing Council in the weeks and months ahead, as inflationary pressure builds. Earlier this month the EU’s flash CPI reading hit a record high of 5%, exceeding expectations of 4.8%. Further increases in energy prices, alongside an eye-wateringly high PPI reading, are expected to continue to filter through into the headline CPI numbers in the coming months. Factory gate prices in Spain, Italy, France and Germany are already well above or close to 20%, and likely to rise further. On a more positive note, core CPI remains much lower at 2.6%. However, across northern Europe, and particularly in Germany, headline CPI is at its highest levels for 30 years. Back then, the Bundesbank took aggressive steps to address this by lifting rates to 8.75%, from 8%, forcing inflation down. The ECB is unlikely to take similar action to curtail higher prices, which could make the next few years a difficult period for savers across the euro area.

Associated British Foods Q1 results

When Primark-owner Associated British Foods reported full-year results in November, its share price was rebounding from 11-month lows, after the company’s revenue was hit hard by the lockdown at the start of 2021. Since then, the shares have risen steadily, boosted by Primark’s recovery and an improvement in margins. Full-year revenue came in at £13.9bn, only slightly lower than the previous year, while profits before tax came in at £725m. The payment of a special dividend of 13.8p, as well as a final dividend of 20.5p, brought down the curtain on a solid year, in which all of its businesses performed well. Looking ahead to this week’s Q1 numbers, we’re expecting more positive news. In December management provided a trading update saying that like-for-like sales were up compared to Q4. Unsurprisingly Q1 sales are also set to exceed performance in the year-ago period, when most Primark stores were closed due to lockdown restrictions. However, the retailer is facing challenges due to lockdowns in the Netherlands and Austria, and as a result of vaccine passes in Germany. Footfall in the UK is also likely to have fallen in the UK in the leadup to Christmas, as consumers exercised caution amid the rapid spread of the Omicron variant.  

Netflix Q4 results

Netflix shares have taken a bit of a tumble in the past few weeks, largely due to concerns over valuations and the prospect of higher interest rates in the US. Having hit a record high of $700 in November, the shares have drifted lower. When the streaming giant reported its Q3 numbers in October, all the chatter was about the success of Squid Game, even as the company faced increasing competition from Disney+, Apple TV+, Warner Media/Discovery, and Amazon. While the US market is pretty much saturated, with high rates of churn, on a global scale Netflix remains the market leader with over 210m subscribers. Indeed, Netflix is very much holding its own, despite its worst half-year for subscriber numbers since 2016. In Q3 Netflix added 4.4m subscribers, and said it expects to add 8.5m subscribers in Q4. Revenue came in at $7.4bn in Q3, and is expected to reach $7.7bn in Q4. However, profits in Q4 are expected to fall to $0.80 a share, largely because spending on content will see margins decline from 23.5% to 6.5% during the quarter. Full-year operating margins are still expected to come in at 20%, or slightly better, despite the higher spend in Q4. In Q4 we’ve seen Netflix release new series of The Witcher, Cobra Kai, Tiger King, and Lost in Space, while viewers are still eagerly awaiting a new series of Stranger Things, due in summer. As Netflix increases its focus on international markets, there appears little sign that revenue is slowing. The scope for user growth, particularly in international markets, still looks decent. With the addition of video game streaming on mobile devices, and the recent acquisition of the Roald Dahl Company, the potential for Netflix to grow and attract younger viewers looks considerable. 


UK retail sales (December)

Total UK retail sales rose by 1.4% in November, a faster pace of growth than the 1.1% rise recorded in October, as consumers took advantage of Black Friday deals and did their Christmas shopping early. Spending increased across a range of products, with clothing sales returning to pre-Covid levels. However, the pace of growth is likely to have slowed in December, mainly due to the spread of Omicron. Pubs and other hospitality venues were negatively affected as many consumers chose to avoid crowded places. On the plus side, supermarket food sales are likely to have remained strong as people enjoy Christmas at home, with more families able to get together than a year ago. Nevertheless, retail sales in December are expected to decline 0.6% compared to November. 

Index dividend schedule

Dividend payments from an index's constituent shares can affect your trading account. View this week's index dividend schedule.

Selected company results

Monday 17 January 
No major announcements 
Tuesday 18 JanuaryResults
Accrol Group (UK)Half-year
Bank of New York Mellon (US)Q4
Goldman Sachs (US)Q4
Watkin Jones (UK) Full-year
Wednesday 19 JanuaryResults
Alcoa (US)Q4
Bank of America (US)Q4
Comerica (US)Q4
Crest Nicholson (UK) Full-year
JD Wetherspoon (UK) Q2
Morgan Stanley (US)Q4
United Airlines (US)Q4
UnitedHealth Group (US)Q4
Thursday 20 JanuaryResults
Associated British Foods (UK)Q1
Baker Hughes (US)Q4
Blue Prism Group (UK)Full-year
Deliveroo (UK)Q4
Ilika (UK)Half-year
M&T Bank (US)Q4
Netflix (US)Q4
Northern Trust (US)Q4
Superdry (UK)Half-year
Union Pacific (US)Q4
Webster Financial (US)Q4
Friday 21 JanuaryResults
Ally Financial (US)Q4
First Hawaiian (US)Q4
Schlumberger (US)Q4

Company announcements are subject to change. All the events listed above were correct at the time of writing.

CMC Markets er en ‘execution-only service’ leverandør. Dette materialet (uansett om det uttaler seg om meninger eller ikke) er kun til generell informasjon, og tar ikke hensyn til dine personlige forhold eller mål. Ingenting i dette materialet er (eller bør anses å være) økonomiske, investeringer eller andre råd som avhengighet bør plasseres på. Ingen mening gitt i materialet utgjør en anbefaling fra CMC Markets eller forfatteren om at en bestemt investering, sikkerhet, transaksjon eller investeringsstrategi. Denne informasjonen er ikke utarbeidet i samsvar med regelverket for investeringsanalyser. Selv om vi ikke uttrykkelig er forhindret fra å opptre før vi har gitt dette innholdet, prøver vi ikke å dra nytte av det før det blir formidlet.

Før du går..

Prøv CFD-handel med en kostnadsfri demokonto. Få tilgang til vår innovative handelsplattform og test strategien din med 100 000 fiktive kroner.