Top 5 Things to Watch in Markets This Week
Geopolitical tensions, earnings reports, economic data, and more are shaping up to make the coming week in the financial markets an exciting one. For South African investors, staying informed about global market developments is crucial, as it can have a significant impact on your investments and financial decisions. Here are the top 5 things to keep a close eye on:
1. Earnings Season in Full Swing
The third-quarter earnings season is gaining momentum in the United States, and this is of particular interest to South African investors. Several major U.S. companies are set to report their results, and it’s expected to show an improvement in profit growth after a tepid first half.
- Tesla: The electric vehicle giant will kick off earnings for megacaps after the close on Wednesday. Tesla’s performance is closely watched by investors worldwide, making this a key event to monitor.
- Bank of America and Goldman Sachs: Both are set to report ahead of the open on Tuesday. As major players in the financial sector, their results can provide insights into the overall health of the U.S. economy.
- Other big names: Keep an eye on companies like JPMorgan Chase, Wells Fargo, Citigroup, Johnson & Johnson, Procter & Gamble, Netflix, and Philip Morris as they report their earnings during the week.
2. U.S. Data and Federal Reserve Speak
Besides earnings, U.S. retail sales figures for September, due on Tuesday, will offer insights into consumer spending, a key driver of the U.S. economy.
If retail sales have risen more than expected, this could raise concerns about inflation and support the idea that the Federal Reserve will maintain higher interest rates for a longer duration.
Market watchers are also eager to hear what Federal Reserve Chairman Jerome Powell has to say when he addresses the Economic Club of New York. Several regional Fed presidents and governors will also make speeches during the week.
3. Oil Market Volatility
Oil prices experienced a nearly 6% surge on Friday, driven by the potential escalation of the conflict in the Middle East, which began with Israel’s ground raids in the Gaza Strip.
While the Middle East conflict hasn’t significantly impacted global oil and gas supplies, it’s important for South African investors to stay updated on this issue because it could influence supply dynamics in the world’s top oil-producing region.
Additionally, the U.S. imposing sanctions on tankers carrying Russian oil priced above the Group of Seven’s price cap of $60 a barrel could affect oil supply, considering Russia’s status as a major oil producer and exporter.
4. Economic Data from China
On Wednesday, market watchers will be closely examining a barrage of economic data coming out of China. This data will provide valuable insights into the world’s second-largest economy, which has experienced an uneven recovery.
Economists are expecting the data to indicate a modest year-over-year pickup in gross domestic product, still below Beijing’s annual growth target of about 5%. South African investors should follow these developments as China’s economic health can impact global markets.
5. U.K. Economic Data
The United Kingdom is set to release its latest economic reports, including data on inflation and employment. These reports are significant for South African investors, as they can influence currency exchange rates and investments in British assets.
U.K. inflation has been above expectations, but it slowed unexpectedly in August. The Bank of England’s stance on interest rates and its actions will depend on this economic data. South African investors with interests in the U.K. should closely follow these developments.
Conclusion
Staying informed about global market events is essential for South African investors looking to make informed financial decisions. As geopolitical tensions persist and earnings reports, economic data, and oil market dynamics evolve, keeping a close watch on these five key factors will help you navigate the ever-changing world of finance and investments. Remember to stay informed, stay diversified, and make informed choices in the week ahead.
