Knight Investment Limited – Earnings Season Continues – Week Ahead in US Markets

HONG KONG - Aug. 6, 2018 - PRLog -- As earnings season continues, last week saw Apple become the first U.S. company to eclipse $1 trillion in market value on Thursday, the U.S. economy added 157,000 jobs in July, and the trade deficit grew in June on account of a decline in exports.

It was a strong week for markets and the economy in the first week of August, and it looks set to continue.

Each of the major indexes finished the week with gains, led by the Nasdaq which added more than 1%. And with the July jobs report and the Fed's latest policy statement, the economic calendar essentially runs into autopilot until September, when investors will prep for another Fed rate hike and a busy fall with midterm elections less than 100 days away.

In the week ahead, investors will also see an earnings calendar that is winding down as 45 members of the S&P 500 will report results. As a point of comparison, 48 members of the benchmark index reported earnings in a single day on Thursday.

Leading the earnings flow this week will be Disney, set to report earnings after the close on Tuesday, while Papa John's results will be closely watched as that company has been engulfed in controversy over the use of a racial slur by its founder and now former CEO back in the spring.

Other companies set to report quarterly results in the week ahead include Discovery, Twenty-First Century Fox, Viacom, News Corp., Marriott, Michael Kors, Mylan, Booking Holdings, Match Group, Twilio, Yelp, and Roku.

And the economic data schedule this coming week will be light, with the monthly reading on job openings and the July report on inflation set to highlight the economic calendar. Friday's inflation data should show that "core" consumer prices — which strip out the impacts of food and energy — remain slightly above the Fed's 2% inflation target. "Core PCE," another measure of inflation which the Fed prefers, is currently indicating that prices are rising less than the Fed's target.

Economic calendar

• Monday: No major economic data scheduled.
• Tuesday: Job openings and labor turnover survey, June (6.638 million jobs open previously); Consumer credit balances, June ($16 billion expected; $24.6 billion previously
• Wednesday: No major economic data scheduled.
• Thursday: Initial jobless claims (218,000 previously); Producer prices, July (+0.3% expected; +0.3% previously)
• Friday: Consumer price index, month-on-month, July (+0.2% expected; +0.1% previously); "Core" consumer prices, year-on-year, July (+2.3% expected; +2.3% previously)

The U.S. economy passes mid-summer test with flying colors
The U.S. economy's mid-summer test has come and gone. And the economy passed with flying colors.

In the last six trading days, investors have gotten a number of major reads on the U.S. economy, most notably the first look at second quarter GDP and the July jobs report.

There was also a Federal Reserve policy statement, which offered a ringing endorsement of the current economic situation, and a series of survey readings on the manufacturing sector, the services sector, and consumer confidence.

Most all of this data came up roses.

On July 27, the first estimate of second quarter GDP showed the economy grew at an annualized rate of 4.1%, the fastest since 2014 and the source of considerable excitement from the Trump administration.

President Donald Trump boasted about the GDP numbers last week, saying that his administration has "accomplished an economic turnaround of historic proportions."

"The most important thing," Trump added, "is these [GDP numbers] are sustainable. This isn't a one-time shot. I happen to think we're going to do extraordinarily well in our next report…I think the numbers are going to be outstanding."

To find out more about Knight Investment Limited and the opportunities it sees in the markets, contact us at info@knight-investment.com or visit our website www.knight-investment.com to find out more about their services and products available.