Monday should be relatively quiet as U.S. equity markets will be closed for Martin Luther King Day, but as they say “it’s always calm before the storm.” Here are five potential market-moving events in which every investor should be aware.
1. European Central Bank (ECB) Policy Decision: Thursday could potentially be the most significant day for global markets as ECB’s governing council will meet followed by a new conference featuring its President Mario Draghi. Many economists believe a significant stimulus package will be announced (much like the U.S. Fed’s QE)as the Eurozone has officially fallen into deflation. The Swiss National Bank’s “shocking” move to abandon the Swiss franc’s peg to the euro last week will undoubtedly feature prominently in the ECB’s discussion. Switzerland’s move may accelerate a global currency war, which could cause gold to shine.
2. U.S. Corporate Earnings: Before trading resumes on Tuesday, Morgan Stanley is expected to report earnings of $0.56 cents a share, while Johnson & Johnson is forecast to post a profit of$1.25 a share. After the bell, IBM and Netflix are expected to earn $5.44 and $0.45, respectively. Other notable financial results expected this week include American Express on Wednesday and General Electric and McDonalds on Friday morning.
3. Oil Prices: Showed signs of stabilizing last week, although this could be short lived. The U.S. Energy Information Administration forecast Tuesday that it “expects global oil inventories to continue to build in 2015, keeping downward pressure on oil prices.” And, Goldman Sachs called for oil to drop below $40 a barrel, likely by summer. The release of Crude Inventories on Thursday could add more fuel to the fire.
4. U.S. Housing Starts: (Jan/21/15): The Housing Starts report reflectson the aggregate demand for the housing market as well as the overall economic outlook for the construction industry. For investors, the reportcarries valuable clues for the stocks of homebuilders, furnishing companies and mortgage lenders. Commodity prices are also very sensitive to change to changes in the housing starts.
5. Japanese Monetary Policy Decision:The Bank of Japan (BOJ) is set to make yet another crucial decision in relation to its monetary policy on Wednesday.The Bank will most likely update us on inflation and growth forecasts. According to Bloomberg, the BOJ is aiming for stable 2% price gains.
Notable Canadian earnings releases this week:Thompson Creek Metals Company Inc. (TSX: TCM) on Monday, Celestica Inc. (TSX: CLS) on Tuesday, Canadian Pacific (TSX: CP), Goodfellow Inc. (TSX: GDL), SENSIO Technologies Inc. (TSXV: SIO), and Richelieu Hardware Ltd. (TSX: RCH) on Thursday.
