News & Analysis

Week Ahead: Earnings Season

July 13, 2020

By Deepta Bolaky
 @DeeptaGOMarkets

Earnings Season

It will be a busy week with investors gearing up for a new earnings season while still keeping track of the rising number of virus cases and the dominant geopolitical risks. On the economic front, attention will be on central bank meetings, leading economic indicators and the EU summit.

United States

In the US, immediate attention will be on the earnings season. On the economic front, Retail Sales, Jobless Claims, and Philadelphia Fed Manufacturing Survey will be among the major events for the week. Recently, economic data has shown that the US economy is on the rebound. In June, the US recorded an increase of 17.7% in retail and food services for May 2020 from the previous month. We expect Retail Sales to remain solid. Similarly, we expect NY and Philadelphia surveys to continue to show improvement in the manufacturing sector.

However, given the record daily virus cases in the US outbreak, more lockdown or various forms of social distancing measures might be back on the horizon which would tame the recovery process.

Eurozone 

The two main events for the Eurozone will be the ECB rate meeting and EU leaders Special Summit on Thursday and Friday respectively. At the last meeting, the ECB increased its pandemic emergency purchase program. We, therefore, do not expect much surprises in Thursday’s meeting – President Christine Lagarde will probably maintain the same status quo. The summit will probably gather more attention and be the market-mover event for the shared currency. The solidarity of the EU members will be tested this week on the overall size of the EU’s Covid-19 response. The extent of compromises or another delay in reaching an agreement could negatively impact the Euro.

UK

Besides Brexit-related headlines, notable events for the Kingdom will be GDP figures and employment data. Chancellor Rishi Sunak’s recovery plan and some Brexit optimism helped the British Pound to rally to the upside.

Australia & China

While Aussie employment data will be released later this week, China’s slew of leading economic indicators will more likely be the key events for the Aussie dollar:

Tuesday: Exports, Imports, and Trade Balance 

Thursday: Gross Domestic Product, NBS Press Conference, Industrial Production and Retail Sales (China)

Equity Markets

Global stocks swung between gains and losses last week as doubts of economic recovery resurfaced following the rising number of coronavirus cases. The stock market ended the week on a cautiously optimistic tone. Aside from the spike in the number of infections, the attention will be concentrated on the US earnings season. 

The earnings season will kickstart with big banks like JP Morgan Chase, Citigroup, Wells Fargo, Goldman Sachs, Bank of America, Morgan Stanley, and tech stock like Netflix.

Monday

CompaniesReporting TimeTeleconference/Webcast Time
PepsiCo (PEP)Before Bell at approximately 6:00 a.m. (ET) At 6:30 a.m. (ET), pre-recorded management discussion and transcript of prepared remarks will be released.

Tuesday

CompaniesReporting TimeTeleconference/Webcast Time
JPMorgan Chase & Co (JPM)Before Bell at approximately 7:00 a.m. (ET)At 8:30 a.m. (ET), results will be reviewed via an investor conference call.
Citigroup Inc (C)Before Bell at approximately 8:00 a.m. (ET)At 10:00 a.m. (ET) results will be reviewed by a live audio webcast and teleconference.
Wells Fargo & Co (WFC) Before Bell at approximately 8:00 a.m. (ET)At 11:00 a.m. (ET), the Company will host a live conference call.

 Wednesday

CompaniesReporting TimeTeleconference/Webcast Time
Goldman Sachs Group Inc (GS)Before Bell at approximately 7:30 a.m. (ET)At 9.30 a.m. (ET) the Company will host a conference call.

 Thursday

CompaniesReporting TimeTeleconference/Webcast Time
Bank of America Corp (BAC)Before Bell at approximately 6:45 a.m. (ET)At 8.30 a.m. (ET), an investor presentation will follow.
Johnson & Johnson (JNJ)Before Bell at approximately 6:45 a.m. (ET)At 8.00 a.m. (ET), results will be reviewed via a conference call.
Morgan Stanley (MS)Before Bell at approximately 7:15 a.m. (ET)At 8.00 a.m. (ET), results will be reviewed via a conference call.
Netflix Inc (NFLX)After Market Close at approximately 1:00 p.m. (PT)At 3.00 p.m. (PT), a video interview will be made available.

Friday

CompaniesReporting TimeTeleconference/Webcast Time
Snap Inc A (SNAP)After Market Close at approximately 2:00 p.m. (PT)At 2.00 p.m. (PT), results will be reviewed via a conference call.

Commodities

Oil

Crude oil prices struggled to find upside momentum following bearish oil reports and a fragile risk sentiment:

  • The API reported a build of 2 million barrels in crude oil inventories
  • The Energy Information Administration reported a rise of 5.7 million barrels of crude oil in the week to July 3

We expect traders to keep monitoring weekly and monthly reports and COVID-19 infections to gauge oil demand.

Gold

Last week, the uncertain environment drove Gold to $1,800 for the first time since 2011. The XAUUSD pair hit a high of $1,818 before easing lower. However, the precious metal held around the $1,800 mark. The doubts of economic recovery following the resurgence of virus cases remain the primary factor of caution for markets which will continue to support the precious metal. Gold traders will also take clues from the earnings season.

Key Events Ahead

Monday
  • Foreign Direct Investment (China)
  • BoE’s Governor Bailey Speech (UK)
  • Monthly Budget Statement (US)
Tuesday
  • REINZ House Price Index (New Zealand)
  • Exports, Imports, and Trade Balance (China)
  • BRC Like-For-Like Retail Sales, Industrial & Manufacturing Production, and Gross Domestic Product (UK)
  • Harmonized Index of Consumer Prices ad ZEW Survey – Current Situation and Economic Sentiment (Germany)
  • Consumer Price Index (US)
  • SNB’s Chairman Jordan speech (Switzerland)
Wednesday
  • Westpac Consumer Confidence and HIA New Home Sales (Australia)
  • BoJ Monetary Policy Statement, Interest Rate Decision and Outlook Report (Japan)
  • Consumer Price Index, Retail Prices Index, PPI Core Output (UK)
  • 10-Y Bond Auction (Germany)
  • BoC Rate Statement, Interest Rate Decision, Monetary Policy Report and Press Conference (Canada)
  • Fed’s Beige Book (US)
 Thursday
  • Consumer Price Index (New Zealand)
  • Consumer Inflation Expectations, NAB Business Confidence, Part-time and Full-Time Employment, Employment Change, Participation Rate and Unemployment Rate (Australia)
  • Gross Domestic Product, NBS Press Conference, Industrial Production and Retail Sales (China)
  • Claimant Count Change, ILO Unemployment Rate, Average Earnings and BoE Credit Conditions Survey (UK)
  • ECB Interest Rate, Deposit Rate Decision and Monetary Policy Statement and Press Conference (Eurozone)
  • Retail Sales, Jobless Claims, and Philadelphia Fed Manufacturing Survey (US)
Friday
  • Business NZ PMI (New Zealand)
  • GfK Consumer Confidence (UK)
  • EU Leaders Special Summit, and Consumer Price Index (Eurozone)
  • Retail Sales (Canada)
  • Michigan Consumer Sentiment Index (US)

By Deepta Bolaky
 @DeeptaGOMarkets

Tuesday, 14 June 2020 
Indicative Index Dividends
Dividends are in Points
ASX200WS30US500US2000NDX100CAC40STOXX50
000.4190.08306.0419.08
ESP35ITA40FTSE100DAX30HK50JP225INDIA50
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Disclaimer: Articles and videos from GO Markets analysts are based on their independent analysis. Views expressed are of their own and of a ‘general’ nature. Advice (if any) are not based on the reader’s personal objectives, financial situation or needs.  Readers should, therefore, consider how appropriate the advice (if any) is to their objectives, financial situation and needs, before acting on the advice. For more information of trading, check out our forex trading courses.

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