General, Forex

Week Ahead market preview: Markets susceptible to shocks

Michael Baker, Friday, 14 February 2020

Another week likely to be dominated by the coronavirus as investors start to pin hopes that the spread is dissipating. Equity markets from Europe and the US have enjoyed strong gains lately, with new highs being recorded daily. Traders to focus on regular updates out of China, recent figures from Hubei showed overnight new cases dropping for the first time this month. With markets riding high and susceptible to shocks, investors will look to the week’s events to dictate movements.

US president’s day on February likely to start the week off on a slow note but we do have an interesting earnings release from Beyond Meat. After seeing gains as much as 734% from its initial public offering, investors get the chance to see how they performed in Q4 2019.

The UK banking industry takes centre stage with releases from HSBC, Lloyds Banking Group and RBS likely to dominate headlines. With the PPI scandal drawing to a close and more certainty on Brexit, will we start to see a resurgence in prices?

Economic releases start with German ZEW on Tuesday, which will have a lot of interest due to its previous strong reading. Economic expectations came in a lot more than economists’ consensus with analysts pointing to the resolution in US-China trade talks and better than expected development in the German economy. The latest release will be a good indicator on the outlook and how growth is faring on a wider scale.

Wednesday sees the first of the 4 big numbers from the UK, with the CPI number likely to inject volatility into the sterling market. Analysts were expecting a figure of 1.5% previously but sterling was left disappointed with the actual figure of 1.3%. With inflation continuing to drop and the overhanging threat of disruption of Brexit, interest rates are likely to remain subdued for some time to come. 

The Federal Reserve release their minutes Wednesday evening followed by the ECB doing the same on Thursday. We saw the first meeting of 2020 a fortnight ago, a carefully crafted statement from chairman Jerome Powell did not provide too much excitement for the markets. The minutes will likely gather attention to give any inkling of possible rate cuts by the Fed over the coming months. We saw a change in rhetoric in the line “returning to 2%” inflation which was previously “near 2%”, a deliberate change to show that the Fed are not comfortable with inflation running below target. Developments in the coronovirus and the upcoming presidential elections will likely play a part In the next rate move. No fireworks expected from the minutes of the previous ECB meeting where the central bank kept its ultra-loose policy unchanged.

The week finishes with a flurry of flash manufacturing and services readings from the larger European economies. 2020 has seen the pace of contraction in Germanys manufacturing sector ease as the outlook appears a little more optimistic. There is concern about the pace of staff cuts in the sector, Friday’s numbers to be closely watched for any stabilisation. The UK has also previously seen its manufacturing sector steady as political uncertainties subside. There have been mild recoveries in new orders and business confidence, although exports abroad saw their third month of declines. More important weight will be given to the services number which makes up more than 80% of UK GDP. The last reading from the 5 Feb pointed to a sharp recovery with eh strongest growth of service sector since September 2018, will we see this massive sector continue to grow and possibly boost sterling?

All times indicated are GMT.


Monday, 17 February

All Day US Bank Holiday (Please see revised market opening hours)

UK Company Announcements:


US Company Announcements:

Beyond Meat, Inc.

Tuesday, 18 February

00:30 AUD Monetary Policy Meeting Minutes

10:00 EUR German ZEW Economic Sentiment

UK Company Announcements:

HSBC Holdings plc

US Company Announcements:

Walmart Inc.

Wednesday, 19 February

09:30 GBP CPI

13:30 CAD CPI

19:00 USD FOMC Meeting Minutes

UK Company Announcements:

Lloyds Banking Group Plc

US Company Announcements:


Thursday, 20 February

00:30 AUD Employment Report

09:30 GBP Retail Sales

12:30 EUR ECB Meeting Minutes

UK Company Announcements:


US Company Announcements:


Friday, 21 February

08:15 EUR French Flash Manufacturing/Services PMI

08:30 EUR German Flash Manufacturing/Services PMI

09:00 EUR European Flash Manufacturing/Services PMI

09:30 GBP UK Flash Manufacturing/Services PMI

13:30 CAD Core Retail Sales

14:45 USD Flash Manufacturing PMI

UK Company Announcements:

Royal Bank Of Scotland PLC

US Company Announcements:



Michael Baker

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