What’s Happening Next Week?

This story features ALUMINA LIMITED, and other companies. For more info SHARE ANALYSIS: AWC

By Rudi Filapek-Vandyck

First we’ll have to endure another set of data releases in the US later tonight, but if we take any guidance from yesterday’s releases, today’s updates on consumer confidence,  spending, manufacturing and Q4 GDP are likely to further highlight the fact that all is not well in the land of Emperor Obama.

Might be a good idea not to hold open too large market positions over the weekend.

Next week, of course, will bring us more news from the international gathering at Davos, an interest rate cut by the Reserve Bank of Australia (a minimum of 75 basis points seems to be the new consensus) and a gradually warming up of the corporate results season in Australia.

If initial indications from the week past can be taken as a reliable guidance, investors should expect more write-downs, vague outlook statements, lower expectations for the year ahead plus here and there the occasional cut to dividends and sudden capital raisings.

And there will be profit warnings, of course. Probably more than investors would like to see but hey, it’s that stage of the economic cycle.

Companies reporting in the coming week include Alumina Ltd ((AWC)) on Tuesday, BHP Billiton ((BHP)) on Wednesday, and News Corp ((NWS)) and ResMed on Friday ((RMD)). For a more detailed oversight: see the calendar on our website. Meanwhile, reporting season in the US will continue.

As far as economic data are concerned, Australia should see releases of TD Waterhouse’s survey into January inflation on Monday, as well as the AiG performance of manufacturers index for January (should see further reduction) plus new home sales for December (HIA) and a quarterly update on the house price index.

Across the Tasman, investors will be awaiting the releases of several labour market data such as overtime, wages and costs.

Monday should also see the publication of the latest Manufacturing Purchasing Managers Index for China by CLSA. The previous months have brought us sombre readings. What are the chances January will have provided the sector with a change in trend?

Later that day, the manufacturing PMI for the UK will be released, as well as for Germany and the eurozone. In the US, Monday late should bring us the latest insights into construction spending in December and the January ISM Manufacturing.

Tuesday is looking like a relatively quiet day. In Australia the Reserve Bank will announce its next interest rate cut, but apart from the December PPI for the eurozone it’s all pretty much second-rank stuff elsewhere on the calendar.

The calendar gets a little bit more crowded on Wednesday, when Australia will see the release of retail sales and building approvals, both for December, while the EU equally has retail sales for December scheduled. In the UK, we should see PMI Services January and Consumer Confidence January being released. The US should bring us the ISM Non-manufacturing composite January later that day.

There’s a fair chance the release of BHP Billiton’s interim financials will overshadow anything else that day, though the official PMI manufacturing is due for release in China that day.

On Thursday we should see Q4 unemployment figures in New Zealand (nothing of interest in Australia), but also interest rate decisions by the European Central Bank and the Bank of England. More cuts, we presume.

The US has Q4 Non-farm productivity and Factory orders for December on the calendar.

NZ markets will be closed on Friday, with the calendar leaving investors in Australia nothing to look out for other than companies reporting including News Corp, ResMed and MYOB ((MYO)). Telecom New Zealand ((TEL)) is also reporting that day.

The UK will release data on industrial production and manufacturing productivity that day, while the US will release unemployment figures for January plus consumer credit for December. That should keep investors focused until the very last day of the week.

But first we’ll have to digest the latest US data over the weekend.

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