Next Week At A Glance

This story features NEWS CORPORATION, and other companies. For more info SHARE ANALYSIS: NWS

Next week, the Reserve Bank of Australia is widely expected to hike rates by 25bps to 4.0% at its 2 February meeting while colleagues in England (BoE meeting on Feb 4) and Europe (ECB meeting on Feb 4) are expected to leave official rates unchanged at 0.5% and 1.00% respectively.

The Federal Government is set to unleash the latest Intergenerational Report on Monday. The updated projections of the Federal Government’s long-term fiscal position are the first major salvo in what, CommBank economists believe, is set to be “a lively election year”.  In addition to a Federal poll, fresh votes are to be cast in several States in 2010.

And local corporate results will (finally) take centre stage, with News Corp’s ((NWS)) report expected to unveil the giga-success of Avatar (but what about MySpace?) and with retailers Harvey Norman ((HVN)) and Myer ((MYR)) to update investors on their second quarter sales achievements.

Other companies to report next week include Redflex ((RDF)), Navitas ((NVT)) and ResMed ((RMD)), as well as Tabcorp ((TAH)). No big guns as yet, but interesting reports nevertheless.

The local economic calendar offers, among other items, December retail sales on Thursday, the RBA’s quarterly monetary statement on Friday, a house price index on Monday, trade balance on Wednesday and December building approvals, also on Thursday.

The US economic calendar brings us nonfarm payrolls for January on Feb 5. The numbers are expected to increase by 30,000, driven by the government’s census hiring. Unemployment is likely to stay at 10.0%, with the gradual decline of the discouraged worker effect through 2010-11 holding this series up. (If everything goes as planned tonight should see a Q4 GDP growth figure of circa 5% being released).

The ISM indices (on Feb 1) are expected to show US manufacturing remaining robust but dipping back from the strong finish to 2010, while the service sector (on Feb 3) is forecast to edge further away from the 50 breakeven point.

Pending home sales (Feb 2) are projected to grind higher following the largest m/m drop on record, which was driven by the end of the Homebuyers Tax Credit. Personal income and spending (Feb 1) will continue to be supported by government transfers. Consumer credit (Feb 5) is expected having contracted for the 11th month in a row, taking the total decline to over USD 100bn.

The US corporate results season will continue.

Japan will only release peripheral data next week. The leading indicator (Feb 5) is expected to have edged higher in December, driven by continued improvement in industrial production and higher equity prices during the month. Labour cash earnings (Feb 2) is likely to have remained sluggish as overcapacity persists in the Japanese economy and the unemployment rate is high.

China will see the release of its two separate PMIs on Monday (Feb 1). The UK releases its PMI for manufacturers later that day while its PMI for the services industry is scheduled for release two days later. Monday will also see PMIs for manufacturers released for the eurozone, France and Germany. The UK consumer confidence survey for January will be released on Wednesday.

For a more comprehensive preview of next week’s events, please refer to “The Week Ahead”, published each Monday morning. For all economic data release dates, AGM dates and times and other relevant information, please refer to the FNArena Calendar.

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