After several busy weeks, and with some 90% of S&P companies having already reported Q1 earnings, newsflow slows down and there are no blockbuster US data releases, but US retail sales (tomorrow) and a selection of US housing data will be the highlights. Across the globe, we will also see the monthly China economic activity data dump (tomorrow), GDP and CPI reports from Japan (Wednesday and Friday), along with labor market reports in the UK (tomorrow). In addition, there are a lot of central bank speakers, especially from the Fed. Fed Chair Powell and ECB President Lagarde both speak on Friday with the latter also up tomorrow.
Elsewhere the latest G7 summit starts on Friday in Hiroshima and earnings season still lingers with notable companies reporting being US retailers Walmart and Home Depot, along with China's tech giants Alibaba and Tencent.
Taking a more detailed look at the data, DB's Jim Reid starts with his preview of US retail sales tomorrow, where DB economists expect the headline to print at +0.7% in April, up from -0.6% previously, or +0.5% vs -0.4% ex autos (we will have a detailed retail sales preview later in the day). Headline will likely be boosted by strong auto sales in the month. The gain in ex-autos sales is likely to be gas price related while economists expect a flat reading on retail control (unch. vs. -0.3%), which is the direct input into GDP for goods spending. So consumption is grinding lower after a strong start to the year, something we detailed over the weekend in "There Goes The US Consumer: Card Data Reveal First Drop In Household Spending In Two Years As Upper-Income Wages Tumble, Unemployment Benefits Soar." Investors will also get a read on the US consumer from US retailers which report earnings, including Walmart (Thursday), Target (Wednesday) and Home Depot (tomorrow).
Tomorrow's NAHB housing market index (DB at 44 vs. 46) starts the week for US housing data and will be followed by Wednesday's housing starts and permits and then Thursday's existing home sales.
Thursday's jobless claims will be more important than usual for a couple of reasons. Firstly it is the survey week for the next payrolls release and secondly we saw it confirmed on Friday that a decent slug of the recent rise in claims were likely due to fraudulent filings in Massachusetts. This state seems to have accounted for around half the +23% rise in the 4-week moving average claims number from the late January lows. The 4-week moving average for continuing claims is up around 10% this year so the labor market is easing but not quite as much as the raw claims numbers had suggested.
In Europe, the UK labor market data tomorrow will be interesting following last week's twelfth consecutive BoE meeting hike. Whether the data shows persistent wage pressures, following the last hot print, will likely contribute to whether a pause is feasible at the next meeting on June 22, although another round of wages and inflation data will be due by then as well. The house view is that they will hike another 25bps in June which will be the last for the cycle but with the risks that there'll be more. Elsewhere in Europe, key indicators include the ZEW survey (tomorrow) and the PPI report (Friday) for Germany and Q1 GDP, trade balance for March (tomorrow) and industrial production (today) for the Eurozone.
This week will also be a busy one for the major Asian economies. Starting with Japan, Q1 GDP will be released on Wednesday, trade balance data on Thursday, and the CPI report on Friday.
In China, investors will be focused on the latest economic activity signals tomorrow, with the release of retail sales, industrial production and property investment data. Amid base effects, our economists expect +11% and +21% YoY growth in industrial production and retail sales, respectively (vs 3.9% and 10.6% in March). The industrial production print and its contrast with retail sales will be especially in focus given flailing momentum in the former. New home prices data are due on Wednesday.
China will also be in the spotlight for corporate earnings this week. Its tech giants, including Alibaba (Thursday), Tencent (Wednesday) and Baidu (Tuesday) will be among the most anticipated reports. The full day-by-day week ahead in at the end as usual.
Q1 earnings season is in its final stages, with 80-90% of companies having reported in the US and in Europe. Earnings growth came in better than consensus expected, at -3% y/y in the US, and +3% y/y in Europe, which is a positive surprise factor of 7% and 10% vs IBES estimates, respectively. The low hurdle rate entering the reporting season, combined with the improving fundamentals during the quarter, has likely helped S&P500 blended EPS inflect higher. The last week of earnings as usual focuses on retailers, and we will hear from Walmart (Thursday), Target (Wednesday) and Home Depot (tomorrow).
Below is a day-by-day calendar of events courtesy of DB:
Monday May 15
Tuesday May 16
Wednesday May 17
Thursday May 18
Friday May 19
Finally, focusing on just the US, Goldman writes that the key economic data releases this week are retail sales on Tuesday and the Philly Fed manufacturing index on Thursday. There are many speaking engagements from Fed officials this week, including Chair Powell; Vice Chair Nominee Jefferson; governors Cook, Barr, and Bowman; and presidents Bostic, Goolsbee, Kashkari, Mester, Williams, and Logan.
Monday, May 15
Tuesday, May 16
Wednesday, May 17
Thursday, May 18
Friday, May 19
Source: DB, Goldman, Rabobank, BofA