The Week Ahead: China GDP, FCA study, UK consumer data

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Fund Strategy looks at some key events shaping the week and highlights what to expect.

Monday 17 October

  • Pearson (Q3 results)

Graham Spooner, investment research analyst at The Share Centre, says Pearson is a hold in the firm’s list.

He says: “Concerns have been growing for the group over its exposure to the weak US education market regarding enrolment and textbook sales. The market will be hoping for no more profit warnings, along with an update on cost saving measures and ongoing restructuring. With its significant exposure to the dollar there could be a boost as a result of the weak pound.”

  • EU Inflation, September – Eurostat
  • UK producer price inflation, September 2016 – Office for National Statistics

Tuesday 18 October

  • Index of production and index of construction: April to June 2016 – Office for National Statistics
  • Governing Council of the ECB: monetary policy meeting in Frankfurt
  • US consumer price index, September – Bureau of Labor Statistics

Spooner says: “In August, UK inflation stood at 0.6 per cent, the same as the month before. Recent falls in the pound, and increases in the oil price, which is measured in dollars, and is thus is exacerbated by the falling pound, will hit the inflation figures in the coming months. Inflation may well rise to over 3 per cent early next year.

“But the data for August is not likely to have been significantly affected. However, in September 2015, month on month inflation was minus 0.1 per cent.  If month on month inflation in September 2016 was higher than this, which it probably was, the annual rate will rise.”

  • Burberry (Q2 trading update)

After Brexit and the pound’s fall, Burberry should be a big beneficiary as most of its earnings are non-sterling based, comments Spooner.

He says:”There have been significant management changes recently with Christopher Bailey returning to focussing on the creative side of the business and industry veteran Marco Gobbetti taking the chief executive position, the market will therefore be very keen to find out his assessment of the business and if there are any changes in strategy to come.”

  • FCA – Investment and Corporate Banking Market Study

Wednesday 19 October

  • China – GDP and economic data
  • FCA – Publication of guidance consultation paper on fair treatment of mortgage customers
  • American Express results

Thursday 20 October

  • London Stock Exchange (Q3 results)

Spooner says: “The Brexit vote raised some doubts over the proposed merger with Deutsche Boerse, despite both sides stating that they will push ahead with the merger. Investors will therfore be keen to hear an update on the situation, especially in light of the investigation by competition authorities. Other areas of interest will be trading activity since the vote.”

Friday 21 October

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  • European Council – Theresa May’s first summit
  • HMRC – Property Transactions in the United Kingdom