Tesla tops the bill this week as the EV maker reports its Q3 earnings. Whilst Elon Musk’s SpaceX is making great solo strides forward in the realm of space exploration, the EV space is looking a lot more crowded and competitive. Meanwhile the likes of Amazon, Boeing and Coca-Cola are also due to report during a busy week for US earnings. The Bank of Canada could cut rates by 50bps when it meets after some soft inflation figures.
Here are the week’s key events:
A relatively quiet start to the week ahead on the macro front. Traders will return to their desks with some major themes in mind for the week. First up, China stimulus with the PBOC maybe looking at amending key lending rates. Next up is the Middle East and the response by Israel to the Iran rocket attacks. Third, the US presidential election is only a couple of weeks away and polling data will be increasingly important for positioning and sentiment. IMF and World Bank meetings kick off in Washington DC and we look to some fresh economic news from Germany in the shape of the PPI inflation report and the Buba monthly report.
Whilst the IMF and World Bank are in Washington, the emergence of a new multi-polar world is underscored by the increasingly important BRICS summit, due to start today in Russia. This will provide market participants with an alternative view of that from Washington, and could offer up some answers to geopolitical concerns and the impact on energy markets.
Earnings: 3M (MMM), GE Aerospace (GE), General Motors (GM), Philip Morris (PM), Verizon (VZ), Teladoc Health (TDOC)
Tesla earnings is the highlight as it remains one of the most trade stocks in the world. Quarterly deliveries rose 6.4% in the quarter from a year before, but missed expectations for stronger growth. The key focus will be on margins, which have been pressured, and on the outlook for a reboot in China demand. But after the disappointment of the We, Robot event, investors will be hoping for better news on core EV sales. “We were overall disappointed with the substance and detail of the [robotaxi] presentation. As such, we anticipate TSLA to be under pressure following the event,” said Morgan Stanley analyst Adam Jonas. Dow components Boeing, IBM, AT&T and Coca-Cola are also due to report earnings.
The Bank of Canada is expected to cut, with markets looking at a strong chance it could go with a jumbo 50bps after inflation fell to 1.6%.
Earnings: AT&T (T), Boeing (BA), Coca-Cola (KO), International Business Machines (IBM), ServiceNow (NOW), Tesla (TSLA)
Amazon reports earnings. Analysts expect AMZN to report a profit of $1.14 per share, up 34.1% from $0.85 per share in the year-ago quarter. JPMorgan named AMZN, along with Meta and Uber, among its top three picks going into earnings.
On the economic front, it’s flash PMI day around the world. The main focus will be on the Eurozone as it grapples with a stronger disinflationary trend than elsewhere. The last PMI data showed the increase in input prices was the softest in 14 months, and the second weakest since November 2020. The composite PMI reading slumped to a 7-month low. Meanwhile, the UK will be watched with the Budget due the following week and latest employment data indicating the Bank of England could go for another cut in November.
Earnings: Mastercard (MA), Amazon (AMZN)
It’s off to Japan early doors with the Tokyo core CPI inflation data, which has been holding steady at 2% lately. Later it’s more economic news from Germany with the latest Ifo business climate report. Canadian retail sales and US durable goods orders set the tone for the North American session before the UoM consumer sentiment and inflation expectations surveys.
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Stock market today: the Nasdaq Composite Index surged to new highs today, fueled primarily by Nvidia’s unprecedented achievement of reaching a $4 trillion market valuation.
Datadog (DDOG) Joins S&P 500: Datadog, a leading provider of monitoring and analytics for cloud-scale applications, recently achieved a significant milestone by joining the S&P 500.
U.S. stocks held their ground after the release of the Federal Reserve’s minutes from its June 17–18 meeting, which revealed that only a few officials anticipated rate cuts as early as this month.
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