Macroeconomics: The Day Ahead – 30 November 2020
Good Morning: The Long & the Short of it and The Bigger Picture
Written by Marc Ostwald, ADMISI’s Global Strategist & Chief Economist
- Month end, US/China tensions, Pandemic and Brexit news likely to sideline busy run of statistics; China PMIs and Japan Production beat forecasts; Japan Retail Sales in line; awaiting Spain/Germany CPI, UK lending aggregates, Canada Current Account, US Chicago PMI, Pending Home Sales & Dallas Fed Manufacturing; OPEC meeting, Lagarde tops run of central bank speakers
- Week Ahead: PMIs in focus ahead of US Auto Sales and Labour report; Powell testimony; RBA and RBI on hold; infection rate and activity restriction reality vs. vaccine hope
As is typical the final day of the month sees a rush of economic data, though it is the solid and slightly better than expected official China PMIs, which will probably be the primary influence beyond pandemic, US/China tensions and Brexit related news, along with month end flows, which are likely to prompt some quite hefty rebalancing flows away from equities. There are also somewhat better than expected Industrial Production from Japan & South Korea, as expected Japanese Retail Sales and a very unsurprising dip in the UK Lloyds Business Barometer to digest. Ahead lie Spanish and German HICP, UK Credit & Mortgage Lending, a slew of EU Q3 GDP reports, Canada’s Q3 Current Account and in the US: Chicago PMI, Pending Home Sales & Dallas Fed Manufacturing survey. On the events side, OPEC meets ahead of the OPEC+ meeting tomorrow, while Lagarde tops another busy day for central bank speakers, but it will be talk of a breakthrough compromise on the thorny issue of fisheries in the UK/EU Brexit talks which will probably command most attention, along with the latest US blacklisting of major Chinese companies (SMIC & CNOOC).
RECAP: The Week Ahead – Preview:
For all that it is not uplifting, the world is coming to terms with the fact that this year’s ‘holiday season’ will be not be very festive, and that even with so many very positive signs on vaccines, it will be months before these facilitate a return to greater activity levels. In the meantime, the battle to constrain and reduce infection rates continues, above all in Europe & North America, but also increasingly in parts of Asia, and as such it is self-evident that the economic and social scars of the pandemic will be deeper than many had hoped or expected, though how deep remains unclear. There is a busy schedule of data as the new month gets under way, dominated by PMIs, US and other labour data, and the usual end of month rush of statistics in Japan, while Australia and Canada both see Q3 GDP. On the events side of the equation both Australia’s RBA and India’s RBI are expected to maintain policy rates, while G7 central bank speakers are again plentiful, with Powell and Mnuchin’s testimony to House & Senate committees on the CARES act (Covid-19 support measures) a focal point, after the recent ‘bust-up’ over the withdrawal of Treasury funding for Fed ‘backstops’; the Fed also publishes its Beige Book, and the OECD releases its latest economic outlook. OPEC (Monday) and OPEC+ (Tuesday) meet, and there are a number of major conferences in the bullishly minded metals sector, along with the virtual “Resetting the Food System from Farm to Fork: Setting the Stage for 2021 UN Food Systems Summit”. But with very little time left before the year-end deadline, it will be the UK/EU Brexit deal talks which will likely dominate the headlines. In terms of govt bond auctions, the UK tops the run with four auctions totalling £9.0 Bln, with France holding an auction of longer dated off the run OATs, Germany selling 5-yr and Japan 10 & 30-yr.
To view the full report and to sign up for daily market commentary please email email@example.com
The information within this publication has been compiled for general purposes only. Although every attempt has been made to ensure the accuracy of the information, ADM Investor Services International Limited (ADMISI) assumes no responsibility for any errors or omissions and will not update it. The views in this publication reflect solely those of the authors and not necessarily those of ADMISI or its affiliated institutions. This publication and information herein should not be considered investment advice nor an offer to sell or an invitation to invest in any products mentioned by ADMISI.
© 2020 ADM Investor Services International Limited.
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.