FYI | Feb 16 2008
By Greg Peel
The first couple of weeks of the Australian result season has only been a teaser, as the next couple of weeks see the bulk of listed company profit reports. If the first two weeks have been any indication, any stock falling short of consensus expectations will be trashed, any stock only reaching expectations will be sold, and any stock exceeding expectations had better well back it up with improved guidance lest it, too, be sold down. The slightest of sombre outlooks could result in double digit percentage falls, such is the nervousness in the current market.
The stocks reporting this week are too many and various to list here, so please refer to the FNArena calendar.
It’s not a huge week for Australia on the economic data front. On Tuesday we are graced with the minutes of the February RBA meeting which gave us a rate hike. We also receive a preliminary balance of payments reading for January.
Wednesday will be interesting, as we learn the fourth quarter wage cost index. Wage inflation is what has the RBA most concerned, given wages have been relatively well behaved until now despite full employment. We also learn skilled vacancies in February and the January leading economic index.
Thursday brings average weekly wages for November, which is a bit old hat, along with more important January new vehicle sales. We also receive an RBA bulletin, but one wonders whether there’s anything left to be said for the time being.
Over in the US it’s the Presidents’ Day public holiday on Monday when markets are closed. Tuesday brings the NAHB housing market index for February, which will no doubt be a tale of woe, as will January housing starts and building permits which are released on Wednesday. Wednesday also sees the release of the January CPI – a figure which is gaining more significance as it starts causing more concern (see today’s Overnight Report), and the minutes of the January Fed meeting, which brought another 50 point cut, are released.
Thursday brings the Philadelphia Fed index of business activity. Pennsylvania is considered a bellwether state, and when a bad reading was released last month the stock market collapsed. We have already seen a woeful New York result (see Overnight Report). January leading indicators are also released.
