Key announcements to move markets next week. http://blog.trading212.com/the-coming-week-02-06-03-2015/
Two Federal Reserve officials offered competing views today about when to start raising interest rates, as the debate over when to act intensifies. New York Fed President William Dudley said that the risks in lifting interest rates too soon are higher than the risks of doing so too late. In On the other hand, Loretta Mester, the president of the Cleveland Fed, said investors might misunderstand a cautious approach from the US central bank.
"I look forward to wearing the watch in the very near future and possibly driving the car in the more distant future," Carl Icahn, one of Apple's largest and most vocal investors, told other shareholders today. Icahn may be talking up the prospects of an Apple car, but Apple has not publicly admitted it's developing a car business.
With a 20% share of all smartphone shipments in the fourth quarter of 2014 thanks to the iPhone 6 and iPhone 6 Plus, and Apple took nearly all the industry's profits. According to Strategy Analytics, with $18.8 billion in operating profits for the last quarter of 2014, Apple took a record-breaking 89% share of the $21-billion profit generated by the smartphone industry during that quarter. This situation that could spell trouble for Google, analysts warned.
Priceline Group Inc. today tapped company veteran Paul Hennessy to lead priceline.com as the division’s next chief executive, effective as of 1st April. Hennessy is currently the chief marketing officer of Priceline’s Booking.com brand and he will replace Chris Soder, who will become chairman of priceline.com. Last week, the shares of Priceline Group soared after the company posted much better-than-expected results in the last quarter of 2014.
Fiat Chrysler Automobiles said today it will recall about 467,500 SUVs globally in order to fix a fuel-pump issue that could cause engine stall. Affected vehicles are the Dodge Durango from model years 2011 and 2012 and the Jeep Grand Cherokee diesel versions from 2011 model year sold outside North America.
Germany's Volkswagen AG said today it lifted its 2014 dividend after a clear surge in profit and said it expects moderate revenue increase this year. Net profit in 2014 was EUR 10.85 billion, up from EUR 9.07 billion. Revenue rose 2.8% on the year to EUR 202.5 billion from EUR 197 billion, influenced by negative exchange rate effects. For 2015, the company expects sales revenue to rise by up to 4% on a yearly basis. Volkswagen forecasts an operating return on sales between 5.5% and 6.5% amid challenging economic environment.
There was an upward revision in the final reading of the University of Michigan's consumer sentiment report for February, but the index still retreated for the first time since July. The sentiment index came in at 95.4 points this month, up from a preliminary reading of 93.6 points, but down from January's 98.1 print. Sentiment has been boosted in recent months by the steep slide in gasoline prices and by the recovery in US labour market.
US pending home sales picked up in January to their highest level since August 2013, the National Association of Realtors (NAR) announced today. NAR’s pending home sales index rose 1.7% from an upwardly revised December reading, and sales were up 8.4% from January 2014 levels. "The difference this year is the positive factors supporting stronger sales, such as slightly improving credit conditions, more jobs and slower price growth," the report said.
January Pending Home Sales are 1.7% on a monthly base, it was expected to be 2.0% versus -3.7% previously.
February Final University of Michigan Confidence index is 95.4 points, it was expected to be 94.0 points versus 93.6 points previously.
The February reading of ISM-Chicago Business Survey dropped to a 5-and-a-half year low of 45.8 points. The reading was much weaker than the 59.4 points logged in January and fell below the 50-mark separating contraction from expansion. The decline was due to losses in the sub-indexes for production, new orders, orders and employment. The West Coast port strike and the cold winter probably had a negative impact on the business in February, the report said.
February Chicago PMI (Purchasing Managers' Index) is 45.8 points, it was expected to be 58.0 points versus 59.4 points previously.
The EUR/USD pair slipped sharply in the same time Wall Street opened, but some news agencies said the weakness in the single currency was due to reports that the ATMs of Greece’s Piraeus Bank in Athens have run out of cash. Sources said customers have formed long lines to withdraw cash from the ATMs with no apparent success. The EUR/USD pair fell 0.6% to 1.1175 so far today.
German auto maker Volkswagen maintained its guidance for operating profit after reporting record earnings in 2014 on double-digit gains in sales of its luxury brands Audi and Porsche. Europe's largest carmaker said today the group’s operating margin could come in a range between 5.5% and 6.5%, the same as last year's forecast. The company boosted its forecast for revenue, saying it could exceed last year's record EUR 202.5 billion by as much as 4%. VW’s stock slipped 7% to EUR 211.66 a share after the announcement.
Carl Icahn's investment portfolio posted its first annual loss since 2008 last year amid tumbling oil prices, though its $7-billion stake in Apple Inc. helped soften the blow as the tech giant’s stock has gained 73% in 2014.
The American economy cooled in the last three months of 2014, returning to moderate growth. The US gross domestic product, which is the broadest measure of goods and services produced in the economy, rose at a 2.2% annual pace in the 4th quarter, weaker than an initial estimate of 2.6% reported last month. Economists had expected a 4th-quarter expansion of 2%. The overall economic picture in the 4th quarter was mixed, with US consumers spending at the fastest rate in 4 years but business investment slowing down, decelerating exports and government expenditure. However, the US economy has been expanding enough to create new jobs to support consumer spending, which is the major driver of the US economy. The US dollar gained after the release.
Second estimate of PCE (Personal Consumption Expenditures) for the fourth quarter is 4.2% annualized, it was expected to be 4.3% versus 4.3% previously.
Second estimate of Gross Domestic Product (GDP) for the fourth quarter is 2.2% annualized, it was expected to be 2.0% versus 2.6% previously.
Not long after a jury decided Apple Inc. should pay $532.9 million jury to a Texas company Smartflash for its patents, the iPhone maker is again sued by the same company. Smartflash aims to make Apple pay for using the firm's technology without permission in devices not be included in the previous case, such as the iPhone 6 and 6 Plus and the iPad Air 2. The first trial covered older Apple products.
According to flash data, growth in German consumer prices accelerated much more than expected in February. Today’s report showed a rise in the Consumer Price Index to 0.9% this month, from a 1.1% drop in January. The CPI also picked up 0.1% on the year, also above previous month’s 0.4% drop. Both readings beat economist projections and gave a slight lift to the euro.
February Preliminary CPI (Consumer Price Index) is 0.1% on a yearly base, it was expected to be -0.3% versus -0.4% previously.
February Preliminary CPI (Consumer Price Index) is 0.9% on a monthly base, it was expected to be 0.6% versus -1.1% previously.
German lawmakers approved with big majority an extension of Greece's bailout program today after Finance Minister Wolfgang Schaeuble pledged he would not let Greece ‘blackmail’ its euro partners. The Bundestag vote was the only major hurdle for a 4-month extension to the rescue funding for the indebted Balkan country.
European stock futures climbed to fresh 7-year highs today, extending a 2-month rally fuelled by the European Central Bank (ECB)'s money printing program which starts in the coming weeks. Germany's DAX 30 futures rose 0.4% to 11,350.4 points, contracts on France's CAC 40 surged 0.5% at 4,925.5 and those on UK's FTSE 100 climbed 0.2% to 6,914.3 points. European shares benefited from a retreat in Asian and US markets fuelled by overnight pullback in crude oil prices, which dampened risk appetite there.
Apple sent out invitations for a media event in San Francisco on 9th March, nearly one month before the launch of its new Watch. The world's largest tech company didn’t give away any details about the theme of the event, but the name ‘Spring Forward,’ is a word play on the resetting of watches for daylight saving time. This was enough for some Apple fans to expect some updates about the company’s first wearable device.
Swedish networking company Ericsson AB said today it is suing Apple Inc. for infringing 41 patents it says are critical to many aspects of Apple’s devices. Ericsson said the US tech giant had declined a licensing deal and refused an offer to have a court determine fair licensing terms, so it has filed 2 complaints with the US International Trade Commission, and 7 complaints in the Texas District Court.
Austria's economy stagnated at the end of 2014 as weak export demand was unable to offset continuing sluggish domestic demand, the Austrian Institute of Economic Research said today. After expanding slightly in the first half of last year, the Austrian economy stagnated on a quarterly basis in the second half, the institute said. For the whole 2014, the Austrian economy picked up 0.3%, slightly below earlier estimates.
Austria's largest lender by assets, Erste Group Bank AG, posted today a 4th-quarter net profit after a serious balance sheet clean-up in Romania and costs from foreign-denominated loans in Hungary dragged on the results. Erste Group's 4th-quarter net profit of EUR 42 million beat analyst expectations and is a major progress after a net loss of EUR 370.3 million in the same period a year ago. The stock of Erste gained 1.8% to EUR 23.83 a share so far today.
Google only declared that it would ban adult content posted to its Blogger platform a few days ago, but it's already decided the move was too hasty. Now, instead of banning sexually explicit images and video and forcing blog owners to delete older posts, the company has told users that it will focus on the publishing of commercial porn.
Spanish consumer price slipped in February for the 8th straight month, as low energy prices support consumers, but raise risks for prolonged deflation. Preliminary data from Spain's national statistics institute showed today that the country's European Union-harmonized consumer-price index fell 1.2% on a yearly basis this month, compared with a 1.5% drop in January.
In a documentary aired this week on the French-German public television station Arte, an executive director from the International Monetary Fund said that in 2010, when the Greek bailout was initially arranged, the institution violated its own lending rules. According to those rules, the IMF is not supposed to resort to exceptional access lending when a country’s public debt is unsustainable or when the chances of program success are not good. Apparently the circumvention was made for political reasons, according to the documentary.
Slower growth made Google Inc. opt for a new sales trick. Yesterday, the search giant said it will let software developers pay to promote their applications in the Play Store for the first time. This will be a trial program available to a limited number of users.
The Swedish krona was strongly supported by the news that GDP gained 1.1% in the final quarter of last year. EUR/SEK is falling from around 9.40 to a three-week low of 9.35, while NOK/SEK is declining from 1.10 to a fresh two-week low below 1.09.
January Retail Sales are 1.4% on a yearly base, the indicator was 2.6% previously.
January Retail Sales are -0.7% on a monthly base, the indicator was 0.2% previously.
Yesterday Coca-Cola Co. joined many other US firms active on the European bond markets to take advantage of low borrowing costs. The company sold EUR 8.5 billion worth of new bonds, the largest euro-denominated bond from a US company on record. Analysts expect the trend to continue, as yields on benchmark European government bonds keep declining, and as the European Central Bank is preparing for large-scale bond-buying.
Airbus Group NV announced today it would increase production of its A320 jet and reported a 59% increase in earnings for 2014 in spite of problems with a large-scale military aircraft programme. Net income amounted to EUR 2.3 billion, versus EUR 1.5 billion a year earlier. Sales in the period gained 5% to EUR 60.7 billion. The company proposed a record dividend of EUR 1.20 a share. Airbus shares increased 6.8% to EUR 54.98 so far today.
January Retail Sales are 5.1% on a yearly base, it was expected to be 3.8% versus 3.4% previously.
January Retail Sales are 1.2% on a monthly base, it was expected to be 0.5% versus -0.6% previously.
Fourth quarter GDP (Gross Domestic Products) is 2.7% on a yearly base, it was expected to be 1.5% versus 2.1% previously.
Fourth quarter GDP (Gross Domestic Products) is 1.1% on a quarterly base, it was expected to be 0.5% versus 0.3% previously.
French consumer spending rose more than expected in January, indicating the economy started 2015 on a firmer footing after three years of weak economic growth. Consumer spending--the largest factor of French economic growth--rose 0.6% in January from December and was 2.6% higher on yearly basis. That marked the third consecutive month of rising consumer spending. On average, economists had expected a 0.4% monthly decline and a 1.6% yearly rise. After expanding no more than 0.4% a year since 2012, the French economy is showing signs of gaining momentum and officials said improved confidence from data could help economic growth rise above the official 1% forecast this year.
BASF SE said today the net profit rose 25% in the fourth quarter, boosted by strong growth in its chemicals businesses. The world's largest chemicals company said net profit for the October-December period was EUR1.42 billion compared with EUR1.13 billion a year earlier. Analysts had expected a net profit of EUR922 million. The company's closely watched earnings before interest and taxes before special items rose 2.8% to EUR1.46 billion, a result of higher profit margins in the petrochemical and agrochemical units. BASF said it expects a slight increase in sales for 2015 and for earnings to match the level it achieved in 2014, at EUR7.36 billion. Shares fell 1.7% to EUR85.40 after the opening bell today.
February Flash HICP (Harmonized Index of Consumer Prices) is -1.2% on a yearly base, it was expected to be -1.5% versus -1.5% previously.
The change in the annual Consumer Price Index was -1.1% in February, according to a flash estimate. It was expected to be -1.5% following the final estimate for the previous month of -1.3%.
Japan's inflation rate slowed again in January to its lowest level in more than a year and half as global oil prices continued to fall. Official data released today showed that on-year growth in the core consumer price index--excluding volatile fresh-food prices and an increase in the sales tax last year--slowed to a 0.2% increase in January from a 0.5% rise in December. Earlier this month, BOJ Gov. Haruhiko Kuroda dismissed the possibility of any early action, provided that longer-term inflation expectations are firmly in place and the economy improves.
January Consumer Spending is 2.6% on a yearly base, it was expected to be 1.8% versus 0.5% previously.
January Consumer Spending is 0.6% on a monthly base, it was expected -0.3% versus 1.5% previously.
Autodesk Inc.'s fourth-quarter profit fell sharply as a double-digit increase in revenue didn't offset operating expenses. Autodesk expects a profit in the current quarter of 25 cents to 30 cents a share on $625 million to $645 million and $1.05 to $1.20 a share for the year with revenue increasing 3% to 5%. Autodesk Inc reported a 13.3% rise in quarterly revenue, as the company benefits from its move to a subscription-based revenue model for its computer-aided design (CAD) software. Total subscriptions increased by about 100,000 in the fourth quarter from the previous one. Shares rose 3.1% in the recent after-hours trading to $62.85 a piece.
• Today, at 8:30 GMT, the Swedish Gross Domestic Product data will be announced. The median forecast is for an annual growth of 1.5% during the October-December period versus 2.1% previously. A higher rate of expansion would be positive for the Swedish krona.
• Again at 8:30 GMT the Swedish Retail Sales will be published. They are expected to climb 0.7% in January from the previous month, when the indicator fell 0.6%.
• At 9:00 GMT, the Norwegian Retail Sales will be published. The median forecast is for a rise of 0.4% in January from the previous month when they recorded a 0.2% gain. The retail sales are an important indicator of the economic development and better-than-expected results would support the Norwegian krone.
• At 13:00 GMT, the preliminary German inflation data will be announced. Analysts expect the Consumer Price Index to have decreased 0.3% in February from the same month previous year. It fell 0.4% on a yearly basis in January.
• The revised value of the US Gross Domestic Product (GDP) for the fourth quarter is scheduled at 13:30 GMT. According to the preliminary estimates, the US economy expanded at an annual rate of 2.6% and consumer spending rose 4.3%. Any positive change in the data would boost the US currency.