Weekly Outlook of Financial Markets for June 24-28

Major commodities including gold, silver, oil and natural gas traded down during last week; their fall coincided with the tumble of equity markets and leading currencies such as Euro and Japanese yen against the USD.  Last week’s Fed decision and thedevelopments in China may have contributed to the sharp fall of the financial markets. Will equities and commodities correct this week? In the upcoming week several reports and publications will come into play including: U.S consumer confidence, EU economic summit, EU monetary development, U.S GDP for Q1 (final estimate), GB’s GDP first quarter final estimate, Australia’s private sector credit, Canada’s GDP, U.S pending home sales, German retail sales, and U.S. jobless claims.  Here is an economic outlook for the week of June 24th to June 28th for U.S, GB, Euro Area, Japan, Canada, and Australia.   

(All times GMT):

Monday, June 24th

09:00 – German Ifo Business Climate Index: This index comprises the developments (on a monthly basis) of manufacturers, builders, wholesalers, and retailers in Germany as of June. In the recent report for May 2013, the business climate index rose from 104.4 in April to 105.7 in May; if this trend will persist, it might pull up the Euro.

Tuesday, June 25th

09:30 – GB inflation hearings: In this hearing BOE Governor will testify regarding the economic progress of GB and inflation developments;

15:00 – U.S Consumer Confidence: according to the latest monthly report, for April, the consumer confidence index rose to 76.2 (M-o-M). The current expectations are that the April index may continue to increase; this report might affect commodities prices including the oil and natural gas;

15:00 – U.S. New Home Sales: This report will pertain to May 2013; in the previous report (opens pdf; for April), the sales of new homes slightly rose to an annual rate of 454,000 – a 8.8% gain (month over month); if the number of home sales will continue to increase, it may provide a sign of recovery in the U.S real estate market; this news may also affect the USD.

Wednesday, June 26th

09:00 – Gfk German Consumer Climate Survey: This survey estimates Germany’s consumers’ changes in past and future economic conditions (on a monthly basis) as of June. In the recent report for May 2013, the climate index rose to 6.5;

13:30 – Third Estimate of U.S GDP for 1Q 2013: This will be the third and final estimate of U.S’s first quarter 2013 real GDP growth. In the first estimate the U.S GDP rose by 2.5% in the first quarter; in the fourth quarter the GDP grew by 0.4%. If there will be a sharp change in the growth rate from second to the third Q1 estimate, this could affect not only the US dollar but also commodities rates;

15:30 – U.S Crude Oil Stockpiles Weekly Update: the EIA (Energy Information Administration) will come out with its weekly report on the U.S oil and petroleum stockpiles for the week ending on June 21st;

Thursday, June 27th

09:00 – Euro Area Monetary Development: This monthly update will refer to the changes of the M3, M1 and loans to private sector in the Euro area for May 2013. In the recent April report, the annual growth rate for M3 rose to 3.2%; M1 increased to 8.7%. Finally, the annual growth rate of loans to private sector reached -0.9%. This news suggests the EU inflation might start to pick up even though loans continue to dwindle. Perhaps part of the rise in M1 and M3 is related to the previous decision of the ECB to cut the cash rate by 0.25 may continue to do so in the coming months;

09:30 – GB Current Account: This quarterly report will show of any changes in the gap between the impost and exports as of the previous quarter. Based on the latest report, the deficit expanded to 14 billion pounds.  This report might affect the strength of the British Pound;

09:30 – Final GB estimate of GDP for 1Q 2013: This will be the final estimate of GB’s first quarter 2013 real GDP growth. Based on the previous estimate, in the first quarter of 2013, the GDP contracted by 0.3%. If the GDP growth rate will change, it could affect the British Pound;

Tentative – Italian 10 Year Bond Auction: the Italian government will come up with another bond auction; in the previous bond auction, which was held at the end of May, the average rate rose to 4.14%;

All Day (two days Summit) – EU Economic Summit: In this summit, the EU ministers of finance will focus on unemployment including youth unemployment in EU. Considering Germany’s elections in September, the big decisions are likely to be made at the end of the year;

13:30 – U.S Personal spending: this monthly update will refer to the changes in income and outlays in the U.S during May; in the last report regarding April the personal income fell by 0.2%;

13:30 – U.S. Jobless Claims Weekly Report:  this weekly update will refer to the changes in the initial jobless claims for the week ending on June 21st; in the latest report the jobless claims rose by 18k to reach 354k; this upcoming weekly report may affect the U.S dollar and consequently commodities and stocks markets;

15:00 – U.S. Pending Home Sales: This report presents the shifts in pending home sales in the U.S. for May; in the latest report, the pending home sales index rose by 0.3% (M-over-M). These data are another indicator for the changes in U.S’s housing market; if the housing data will show a rise in sales it may pull up the U.S dollar;

15:30 – EIA U.S. Natural Gas Storage Update: the EIA weekly report of the U.S. natural gas market will pertain to the recent developments in natural gas production, storage, consumption and rates as of June 21st; in the recent weekly report, natural gas storage rose by 91 Bcf to 2,438 Bcf;

Friday, June 28th

02:30 – Australia Private Sector Credit: This monthly report shows the changes in credit in the private sector as of May. As of the previous report regarding April, total credit to the private sector provided by financial intermediaries increased by 0.3% (m-o-m) but rose by 3.1% compared to the previous time in 2012. If this upward trend will persist, it may positively affect the Aussie dollar, which tends to be strongly correlated with major commodities;

07:00 – German Retail Sales: This monthly report will show the shifts in German retail sales during May. In April 2013, retail sales declined by 0.4% – lower than many had anticipated; if this report will show another fall in sales then it might weakened the Euro;

08:00 – KOF Economic Barometer: this monthly report provides an estimate to the Swiss economy in the months to follow;

13:30 – Canada’s GDP by Industry: this monthly report shows the developments in major industrial sectors for April 2013. In the recent update regarding March 2013, the real gross domestic product slightly rose by 0.2%. This report may affect the Canadian dollar, which is strongly correlated with major commodities prices;

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