Look for this week's market indicators, Latest Business News - The New Paper

Look for this week's market indicators

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For much of this month, investors have been taking positively to what they hope are rate cuts by the US Federal Reserve at the month's end, as well as hopes that US-China trade talks are getting back on track.

That said, there are concerns that markets are too optimistic about the extent of rate cuts and there are many issues yet to be ironed out between the US and China since the post-G20 truce.

Charles Schwab's chief investment strategist Liz Ann Sonders noted: "Rather than climbing the proverbial 'wall of worry', the recent move seems to be more of the riding the escalator of optimism."

Following China's Q2 gross domestic product (GDP) release last week, it is now time to assess the US economic performance - Q2 US GDP is out on Friday - for the effect of trade war escalations on the US economy and on US corporate earnings.

Likewise, in the local market, investors are gearing up for the corporate earnings season for the April-June period but there is still economic data to digest.

A slew of economic data indicators in Singapore will be released this week.

This follows already disappointing Q2 advanced estimates for GDP and non-oil domestic exports data of weeks past, which have shown the weak spot in the Singapore economy to be in electronics-related production. Q2 GDP advanced estimates have shown manufacturing contracting 3.8 per cent.

Mr Han Tan, market analyst at FXTM said: "For the week ahead, investors will be looking out for Singapore's inflation and industrial production announcements, both for the month of June. Economic indicators that appear to pave the way for the Monetary Authority of Singapore (MAS) to ease its policy settings later this year could in turn exert downward pressure on the Singapore dollar over the near term."

June consumer price index and core inflation figures will be out tomorrow. According to Bloomberg consensus estimates, inflation for June could come in at 0.7 per cent year-on-year (y-o-y). Meanwhile, the Bloomberg consensus has core inflation, which strips out housing and private transport costs, coming in at 1.2 per cent y-o-y.

Industrial production figures will be out on Thursday, with the market expecting a 7.3 per cent y-o-y contraction. UOB senior economist Alvin Liew noted that with May's industrial production contraction of 2.4 per cent and April's mild gain of 0.1 per cent, the bank thinks that "June's industrial production contraction may worsen to 8.5 per cent year-on-year".

Friday sees Q2 unemployment rate and the final print for URA private home prices for Q2.

The earnings season is gearing up, with four of the Straits Times Index's 30 constituents having already reported earnings. This week, half of the real estate investment trusts (Reits) listed on the Singapore bourse will report earnings while a trio of STI components are reporting their earnings for the second quarter of the calendar year.

Results for CapitaLand Mall Trust are due tomorrow. Hutchison Port Holdings Trust's Q2 earnings will be out on Wednesday and Jardine Cycle & Carriage on Friday.

Elsewhere in the Asia-Pacific, key data for investors to digest include South Korea's Q2 GDP print, where a Bloomberg consensus forecast has the economy growing at 1.9 per cent y-o-y and 0.5 per cent quarter-on-quarter.

With both the effects of the US-China trade skirmish and a global tech slowdown weighing on export-oriented economies in Asia, today's June export orders and tomorrow's industrial production figures for Taiwan will also be keenly watched.

Malaysia's June inflation data is out on Wednesday and China's Q2 industrial profits on Saturday.

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