Weekly Reports | Jun 25 2010
By Greg Peel
Tonight sees the final revision of US first quarter GDP which, under the circumstances, will not be helpful if the revision is downward. The first revision in May saw a drop from 3.2% to 3.0% when an increase to 3.4% was expected, however on that day the Dow happened to rally 284 points so the GDP was lost in the wash.
All things being equal, tonight we have a more sombre Wall Street as the realisation begins to dawn that Europe will be a drag on global growth, China is trying to constrain its economy and the US economy is staring at a housing double-dip and ongoing high unemployment. Economists have already begun to question both consensus double-digit earnings growth estimates for the June quarter in the US and ongoing GDP expectations of 3-4% growth.
And it's employment week in the US next week.
Aside from employment numbers there will be personal income and spending numbers, the Chicago national activity and purchasing managers' indices, consumer confidence, construction spending, vehicle sales and factory orders. Given recent weak housing data, much attention will be paid to the Case-Shiller house price index on Tuesday and pending home sales on Thursday. Then the ADP private sector unemployment number will be released on Wednesday and the official non-farm payrolls number on Friday.
With weekly new jobless claims numbers trending sideways of late, little chance is given of any meaningful reduction in the unemployment rate. An increase would be unfortunate in the current environment.
The US also releases its PMI manufacturing index on Thursday, which is across-the-globe PMI day. Well almost. While China, the eurozone, the UK and US all release their PMIs on Thursday, for some reason this month Australia's number comes out a day ahead.
Australia will also see releases for private sector credit, building approvals and retail sales next week. These numbers would normally feed into speculation about a possible move from the RBA, but the RBA is firmly on hold.
The UK will also revise its first quarter GDP on Wednesday.
This weekend also sees world leaders gathering in Toronto for the latest G20 meetings, sans one G20 pioneer, Kevin Rudd.
For a more comprehensive preview of next week's events, please refer to "The Monday Report", published each Monday morning. For all economic data release dates, ex-div dates and times and other relevant information, please refer to the FNArena Calendar.
