FYI | Jan 18 2013
By Rudi Filapek-Vandyck
Here are the facts: Chinese economic data as released on Friday afternoon surprised to the upside, albeit mildly. Q4 GDP growth, for example, printed 7.9% annualised against market consensus of 7.8% growth.
Yet share prices of mining stocks are retreating in the Australian session. Good news already priced in?
A similar picture emerges in the US where pc chip bellwether Intel beat market expectations with its Q4 results after the market's close earlier on the day. Ignore "beat market expectations" as those results are reported initially. Look a bit deeper and what you'll find is net profits down 27% for the quarter with management guidance for low single digit revenues growth for the full financial year. Intel shares gained during the overnight US session, but the shares are down more than 5% in after-market trading.
Later today, when US investors are back to trading local equities, the University of Michigan will release its findings on US consumer sentiment.
All in all, however, the global economic calendar for the week ahead looks rather light. This could well mean that all talk about equities flashing Overbought signs may remain just that. Unless, of course, the US reporting season throws up a few more Intel-alike disappointments and US investors start taking it in the wrong way. Will global and Australian equities, under such a scenario, follow the US example? They may not.
There's a firm underlying assessment right now that the economic recovery in the US is finally taking hold and there's little on the calendar that can/might put a dent in that general assessment. Next week the International Monetary Fund (IMF) will release its projections for global economic growth, but we already had the WorldBank paring back global GDP estimates. Few would have been genuinely surprised.
Of more importance is that both central banks in Japan and in the UK will meet and the BoJ in particular is widely expected to add more stimulus to the global central bankers liquity fest. The UK economy remains in its worst state since the 1930s, but it's not clear right now whether this also means more immediate action from the BoE.
Otherwise the calendar shows readings on business confidence in the eurozone (Monday), the Chicago Fed national activity index and the Richmond Fed manufacturing survey (both on Tuesday), consumer confidence in the eurozone (Wednesday), PMI releases in Europe and in the US on Thursday and the German IFO business climate survey results on Friday.
Apart from US corporate results, Australian investors will have some local reports to deal with, predominantly December quarter production reports with companies including BHP Billiton ((BHP)), Fortescue ((FMG)) and Newcrest Mining ((NCM)) scheduled to report next week.
The US reporting season offers reports from First Bancorp, General Electric, Morgan Stanley and Schlumberger later today. Next week, on Tuesday, DuPont, Freeport-McMoran, Google, IBM and Johnson&Johnson are scheduled to report, on Wednesday it's Apple's turn, while 3M, AT&T and E*Trade should follow suit on Thursday.
Lance Armstrong's interview with Oprah Winfrey is being broadcast while I am writing and publishing this story. You didn't forget, did you?
For all economic data release dates, AGM dates and times and other relevant information, please refer to the FNArena Calendar.
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