The Week Ahead: Earnings Season

It’s the start of October, which can mean only one thing – the start of the third-quarter earnings season in the US. We will have wait until next week before Singapore blue chips start reporting results, starting with Singapore Press Holdings (SGX: T39).

Some of the big US names to look out for next week include PepsiCo (NYSE: PEP), Costco Wholesale (Nasdaq: COST) and Yum China (NYSE: YUMC), which will report towards the end of the week. Yum’s numbers could be insightful, as it could provide some useful pointers on the state of the Chinese consumer sector.

As it stands, the Chinese services sector continues to expand. In August, the Caixin Services PMI was comfortably above 50, which would suggest expansion. The number for September is expected to show more of the same.

China will also report its trade balance with the rest of the world. This is expected to show that the world’s second-largest economy has continued to export more than it imports. Meanwhile, the US trade balance, which is also due next week, could indicate that it imports more than it exports.

Staying in the US, a number of Fed members will take to the rostrum. They include Robert Kaplan, Jerome Powell, James Bullard and Fed chair, Janet Yellen. They may flesh out the reasons behind the Fed’s decision to reduce its balance sheet. They might even let slip the timing of the next hike in interest rates.

Over in the Eurozone, the head of the ECB, Mario Draghi, is also expected to step into the spotlight. The central bank recently indicated that a substantial degree of monetary accommodation will still be needed to support inflation. That almost rules out a rate rise anytime soon.

In the UK, the release of minutes Bank of England’s latest meeting might reveal when UK interest rates could rise. The Governor of the BoE recently said that interest rates could rise in the “relatively near term”. Some believe that it could be as soon as November.

And finally, the people of Catalan have defied the Spanish government in holding a referendum for independence. The Spanish government has deemed the poll to be illegal and illegitimate. But the Catalan government is going ahead with it, anyway.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore Director David Kuo doesn’t own shares in any companies mentioned.