Weekly Outlook of Financial Markets for October 28 – November 1

During the previous week, energy commodities prices fell including natural gas and oil. Conversely, gold and silver prices continued their upward trend. In the forex market, the USD appreciated against several currencies such as Aussie dollar and Canadian dollar, but declined against the Euro and Japanese yen. In the forthcoming week several reports and speeches may affect commodities, equities and forex markets; these include: FOMC meeting, U.S CPI, BOJ monetary policy statement, Spain’s GDP for the third quarter, Australia’s PPI, U.S, GB and China’s manufacturing PMI, U.S retail sales, Gfk German Consumer Climate Survey, U.S PPI, and U.S. jobless claims. Here is a breakdown for the week of October 28th to November 1st referring to the U.S, Japan, Euro Area, China, Australia, Canada, and Great Britain.  

(All times GMT):

Monday, October 28th

14:15 –U.S Industrial Production: This report will show the monthly developments in the industrial production as of September; as of August, the production slightly rose by 0.4%; this report may affect the USD currency;

15:00 – U.S. Pending Home Sales: This report shows the changes in pending home sales in the U.S for September; in the recent report, the pending home sales index declined again by 1.6% (month-over-month). These data are another signal for the shifts in U.S’s housing market; if the housing data shows additional drop in sales, it may pull back the U.S dollar;

23:30 –Governor Stevens speaks: Reserve Bank of Australia Governor is due to give a speech at the 5th Annual Australian & New Zealand Investment Conference, in Sydney; in his upcoming speech, the Governor may refer to the Australian economy and RBA’s monetary policy; this speech may affect the Aussie dollar;

Tuesday, October 29th

07:00 – Gfk German Consumer Climate Survey: This survey estimates Germany’s consumers’ economic climate (past and future economic conditions – on a monthly basis) for October. In the latest report for September 2013, the climate index slightly rose to 7.1;

13:30 –U.S. Retail Sales Report: This monthly report shows the developments in retail sales and food services for September; in the latest report regarding August, the retail sales edged up by 0.2% from the previous month; gasoline stations sales remained flat in August compared to July 2013; this report could signal the shifts in U.S’s gasoline demand and thus may affect U.S oil prices;

13:30 – U.S. Producer Price Index: This report presents the inflation rate from the producers’ side, will pertain to September 2013. In the last report regarding August, this index for finished goods slightly rose by 0.3% compared with July’s level and the core PPI remained unchanged; this news might affect the USD;

15:00 – U.S Consumer Confidence: According to the previous monthly report, for September, the consumer confidence index slipped to 79.7 (month-over-month). The current expectations are that the October index may further fall; this report might weaken the USD;

Wednesday, October 30th

08:00 – KOF Economic Barometer: This monthly update projects the progress of the Swiss economy in the upcoming months;

08:00 – Flash Spain’s GDP Q3 2013: This report will present the first estimate of the quarterly growth rate of the Spain’s economy in the third quarter of 2013; during the second quarter Spain’s economy contracted by only 0.1% (Q-2-Q);

13:15 – ADP estimate of U.S. non-farm payroll: ADP will come out with its estimate for the next U.S non-farm payroll changes for October 2013 that will be published next week;

13:30 – U.S Core Consumer Price Index: This monthly update refers to the main developments in the core consumer price index for September 2013. Based on the U.S Bureau of Labor statistics, during August, the CPI inched up by 0.1% (month-over-month); the core CPI also slightly rose by 0.1%; this report could affect the direction of the USD and may also affect the FOMC’s monetary policy;

15:30 – U.S Crude Oil Stockpiles Weekly update: The EIA (Energy Information Administration) will publish its weekly report on the U.S oil and petroleum stockpiles for the week ending on October 25th; the report will also present the developments in imports, refinery input and production, which could provide some insight behind the latest changes in the price of crude oil in the U.S; 

19:00 – FOMC Meeting and Statement: The seventh FOMC meeting this year will take place during October 29th and 30th. The FOMC will decide whether it will taper QE3. This time, a press conference isn’t scheduled. Considering the recent U.S government shutdown and the little progress in the U.S labor market, it seems unlikely the FOMC will change its policy this time. If the Fed doesn’t change its monetary policy, gold and silver prices may continue their rally;

Tentative – Japan’s monetary policy meeting and press conference: In the upcoming Japanese monetary policy meeting, BOJ members will decide on any changes to the bank’s current asset purchase program. This decision may affect the Japanese yen;

Thursday, October 31st

13:30 – U.S. Jobless Claims Weekly Report:  This weekly update will refer to the changes in the initial jobless claims for the week ending on October 25th; in the last report the jobless claims decreased by 12k to reach 350k; this forthcoming weekly report may affect the U.S dollar and consequently commodities and stocks markets;

13:30 – Canada’s GDP by Industry: This monthly update shows the changes in major industrial sectors for August 2013. In the previous update regarding July 2013, the real gross domestic product increased by 0.6%. This report may affect the Canadian dollar, which is strongly linked with commodities prices such as oil and gold;

15:30 – EIA U.S. Natural Gas Storage Update: The EIA weekly report about the U.S. natural gas market will pertain to the latest changes in natural gas production, storage, consumption and rates as of October 25th; in past weekly update, natural gas storage rose by 87 Bcf to 3,741 Bcf;

Friday, November 1st

01:30 – Australia’s PPI: This quarterly update will pertain to third quarter of 2013. During the second quarter of 2013, the producer price index rose by 1.2% compared to the second quarter of 2012 and by 0.1% compared to Q1 2013; this index may affect the Aussie dollar;

02:00 – China Manufacturing PMI: As of September, the Manufacturing PMI rose for fourth consecutive month to 51.1 – i.e. China’s manufacturing sectors are expanding at a slightly faster pace; in the last flash PMI report, the index rose to 50.9. If in the upcoming report the PMI continues to rise, it could signal growth in China’s manufacturing sectors, which could also positively affect oil and gold prices;

02:45 – China Manufacturing PMI (HSBC’s final estimate): This will be HSBC’s last estimate for October’s PMI index. Last month’s Manufacturing PMI reached 50.2 – i.e. China’s manufacturing sectors is moderately expanding; the recent flash PMI report rose to 50.9 in October – the highest level in seven months. If the updated PMI index remains elevated or even higher than the flash index, this will suggest China’s manufacturing conditions are growing. Moreover, this shift could have a positive effect on the prices of commodities such as oil and gold;

09:30 – GB Manufacturing PMI: This report will pertain to Great Britain’s manufacturing sector in October 2013. In the last update regarding September 2013 the index slipped to 56.7. This rate drop means the manufacturing sector is still growing but at a slower pace; this index might affect GB Pound;

15:00 – U.S. Manufacturing PMI: This report will refer to October 2013. In September, the index increased again to 56.2% – the highest level in two years; this means the manufacturing is growing at a faster rate; this index may affect stock markets, USD, and crude oil and natural gas markets;

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