Altrice Investment Co. Limited – What to Watch in the Week Ahead – Retail Sales and CPI
All eyes will be on the U.S. economy this week following last Friday's disappointing jobs report.
"Some of the weakness is surely payback for the surprisingly strong prior months' prints, but there is no question that the report was soft," Altrice Investment Co. Limited wrote in a note on Friday. "The actual report shows more weakening than we expected, but is qualitatively consistent with our view that first quarter economic growth will be an outlier to the downside."
On Monday morning, January's retail data kicks off a busy week filled with key economic data. The report was delayed due to the partial government shutdown. "Underlying retail sales probably rebounded in January, but real consumption growth is still likely to slow in the first quarter," Altrice continued on Friday. Economists surveyed by Bloomberg are expecting January's core retail sales to have risen 0.3%, up from the -1.8% decrease in December.
Then on Tuesday, February's CPI data will be released. Investors often look to CPI data as a key inflation gauge. Core CPI is anticipated to have jumped 0.2% from last month and 2.2% from last year, according to economists polled by Bloomberg. "We estimate that both headline and core CPI inflation were little changed in February," Altrice Investment said. "Core inflation has been stuck at just above 2%, but there have been some signs that price pressures are building under the surface, with core goods prices rising sharply." As the Federal Reserve takes a break from raising short-term interest rates, a surprise uptick in inflation could potentially be a red flag.
Additionally, the U.S.-China trade negotiations will also continue to stay in focus. Recent data provided evidence that the tariffs have resulted in a plunge in trade of tariffed U.S. and Chinese goods.
On Thursday, General Electric will be holding a guidance call from 8:30 a.m. - 9 a.m. ET. Management will hold a presentation on the industrial giant's outlook. This comes on the heels of a tumultuous week for GE. The company's stock tanked following comments that it sees "significant known headwinds to 2019 cash flow" for its industrial division. Moreover, two of the longest-serving board members announced their plans to step down on March 8.
Monday: Retail Sales Advance month-on-month, January (0.0% expected, -1.2% prior); Retail Sales excluding Auto month-on-month, January (0.3% expected, -1.8% prior); Retail Sales excluding Auto & Gas, January (0.6% expected, -1.4% prior)
Tuesday: NFIB Small Business Optimism, February (102.5 expected, 101.2 prior); CPI month-on-month, February (0.2% expected, 0.0% prior); CPI excluding Food & Energy month-on-month, February (0.2% expected, 0.2% prior); CPI year-on-year, February (1.6% expected, 1.6% prior)
Wednesday: MBA Mortgage Applications, week ending March 8 (-2.5% prior); PPI Final Demand month-on-month, February (0.2% expected, -0.1% prior); PPI excluding Food & Energy month-on-month, February (0.2% expected, 0.3% prior); PPI Final Demand year-on-year, February (1.9% expected, 2.0% prior); Durable Goods Orders, January (-0.6% expected); Durables excluding Transportation, January (0.2% expected); Capital Goods Orders Nondef excluding Air, January (-0.1% expected); Construction Spending month-on-month, January (0.5% expected, -0.6% prior)
Thursday: Import Price Index month-on-month, February (0.3% expected, -0.5% prior); Initial Jobless Claims, week ending March 9 (225,000 expected, 223,000 prior); Continuing Claims, week ending March 2 (1.755 million prior); New Home Sales, January (635,000 expected, 621,000 prior)
Friday: Empire Manufacturing, March (10.0 expected, 8.8 prior); Industrial Production month-on-month, February (0.4% expected, -0.6% prior); Capacity Utilization, February (78.6% expected, 78.2% prior); University of Michigan Sentiment, March (95.5 expected, 93.8 prior); Net Long-Term TIC Flows, January (-$48.3 billion prior); Total Net TIC Flows, January (-$33.1 billion prior)
Monday: Stitch Fix after market close
Tuesday: Dick's Sporting Goods before market open
Wednesday: MongoDB after market close
Thursday: Dollar General before market open; Adobe, Broadcom, DocuSign, Oracle, Ulta after market close
Friday: No notable reports scheduled
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