Another festive and short week ahead of us due to the Easter holidays. Nevertheless, we may see some interesting inflation data in the US and Germany, and on Friday, several banks are scheduled to report their first-quarter earnings.
Tuesday 11.04 09:00 GTM, Eurozone Retail Sales MoM (February)
The retail sales index measures changes in the total value of sales, taking into account inflation at the retail level. It is one of the main ways of measuring consumer spending, which accounts for a significant proportion of economic activity in any country. Retail sales refer to the sale of products directly to consumers. It usually includes food, beverages, clothing, electronic equipment, furniture, and automotive, tourism, or entertainment services. Therefore, the value of retail sales is one of the key indicators for many sectors of the economy, including trade, manufacturing, and services.
By analysing the changes in retail sales, we can draw conclusions about the state of the economy as a whole. If the value of retail sales increases, it may mean that consumers have more financial resources and are therefore spending more on products and services. If retail sales fall, it may indicate a weakening economy, financial difficulties for consumers, a slowdown in growth or even a recession.
Generally, December could be the busiest period conducive to consumption, but despite the recent December in the eurozone, retail sales fell. The current forecast is 1% on the upside, meaning it expects retail sales to increase by 1% over the previous period under review. In contrast, 1% was expected in the previous surveyed period, but the final figure was reported only at 0.3%.
Source: Tradingeconomics.com
A higher-than-expected reading could be positive/bullish for the EUR, while a lower-than-expected reading could be negative/bearish for the EUR.
Impact: EUR
Wednesday 12.04. 12:30 GTM, US Consumer Price Index (CPI) YoY (March)
The Consumer Price Index (CPI) is a measure of changes in the prices of products and services from the consumer's point of view. It can be used to monitor trends in purchasing power and inflation, which is important for many aspects of the economy. The CPI reflects the price of a basket of goods and services most commonly purchased by households. This basket usually includes food, housing, health care, transport and entertainment. Governments and central banks constantly monitor CPI values as they allow them to understand what price changes are taking place in the market and how they affect household budgets. Changes in CPI values are important in assessing inflationary trends as they indicate increases or decreases in the cost of living for consumers.
A gradual but consistent downward trend can be seen since the peak in July 2022, and it is expected to stabilise around this level. The current forecast is 6%. For comparison, the previous forecast was also 6%, and the result was in line with expectations.
Source: ycharts.com
Higher-than-expected data could be bullish for the US dollar and bearish for the stock market as it may increase the possibility of further interest rate hikes. Conversely, weaker-than-expected data could be bearish for the US dollar and bullish for the stock market.
Impact: USD
Thursday 13.04 06:00 GTM, Germany Consumer Price Index (CPI) YoY (March)
The Consumer Price Index (CPI) in Germany, the same as in the US, provides an understanding of what changes occur in the cost of living for consumers.
In Germany, the downward trend in this ratio has been much shorter than in the US. It is not continuous, i.e. there have been ups and downs in the trend, and in recent months the actual data have been revised upwards from the initial forecasts. The current forecast is 8.7%. In comparison, the previous period under review expected 7.3%, and the result was slightly more, i.e. 7.4%.
Źródło: ycharts.com
Higher-than-expected data could be bullish for the EUR and bearish for the stock market in the eurozone, as it may increase the possibility of further interest rate hikes. Conversely, weaker-than-expected data could be bearish for the EUR and bullish for the stock market in the eurozone.
Impact: EUR
Friday 14.04 12:30 GTM, US Retail Sales MoM (March)
At the time of the outbreak of the covid pandemic, there was a very high volatility in this US indicator. There were large fluctuations, both negative and positive, which have gradually diminished over the past three years and are now relatively small. The current forecast is 0.3% on the downside, which means that retail sales are expected to be 0.3% lower than in the previous period. By contrast, in the last survey period, the forecast was also for a decline of 0.3%, but the final figure was 0.4% on the downside. The total value of sales at this level has been decreasing for the last couple of months, except for January, when the report showed unexpectedly high growth in retail sales (3.2%).
Source: Tradingeconomics.com
A higher-than-expected reading could be taken as positive/bullish for the USD, while a lower-than-expected reading could be taken as negative/bearish for the USD.
Impact: USD
Stocks to watch
Progressive (PGR) announcing its earnings results for the quarter ending on 03/2023. Forecast: 1.43. Positive earnings surprise in 3 out of the last 10 reports. Time: Thursday, April 13, before the market opens.
Fastenal (FAST) announcing its earnings results for the quarter ending on 03/2023. Forecast: 0.4977. Positive earnings surprise in 10 out of the last 10 reports. Time: Thursday, April 13, before the market opens.
Tesco (TSCO) announcing its earnings results for the quarter ending on 02/2023. Forecast: 11.39. Positive earnings surprise in 0 out of the last 10 reports. Time: Thursday, April 13, before the market opens.
UnitedHealth (UNH) announcing its earnings results for the quarter ending on 03/2023. Forecast: 6.17. Positive earnings surprise in 10 out of the last 10 reports. Time: Friday, April 14, before the market opens.
JPMorgan (JPM) announcing its earnings results for the quarter ending on 03/2023. Forecast: 3.43. Positive earnings surprise in 8 out of the last 10 reports. Time: Friday, April 14, before the market opens.
Citigroup (C) announcing its earnings results for the quarter ending on 03/2023. Forecast: 1.71. Positive earnings surprise in 9 out of the last 10 reports. Time: Friday, April 14, before the market opens.
Santa Zvaigzne-Sproge, CFA, Head of Investment Advice Department at Conotoxia Ltd. (Conotoxia investment service)
Materials, analysis, and opinions contained, referenced, or provided herein are intended solely for informational and educational purposes. The personal opinion of the author does not represent and should not be constructed as a statement, or investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.18% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
