The Week Ahead: Fed, ECB and BoJ set rates, and Big Tech earnings in spotlight

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Hello and welcome to the working week.

While many of us are packing shorts and bathing suits for a summer getaway, spare a thought for the suits at the central banks of the US, the EU and Japan whose comments and actions will be the focus of market attention over the coming days.

The Federal Open Market Committee begins its latest interest rate-setting meeting on Tuesday with an announcement due in the afternoon of Wednesday, and the European Central Bank follows a day later. Both are expected to raise interest rates by a quarter of a percentage point.

The main focus of the Fed announcement will be on the signals that chair Jay Powell sends out on the potential for a further rate rise to tackle inflation.

Japan is the joker in the pack. The markets have been pedalling back aggressive rate hike expectations for the Bank of Japan. But the increase in the headline rate of inflation last week, outpacing US inflation for the first time in eight years, has increased the chances of a surprise rate increase after a long period of ultra-loose monetary policy.

Big Tech is the big theme of this week’s packed earnings schedule — more than 150 US companies will report results this week. An edited list of the key players is provided below.

Alphabet, Microsoft and Meta Platforms face very different challenges, but artificial intelligence is a common concern. It’s not going to show through in revenues yet but analysts will be hoping to get a sense from this week’s numbers of when AI is likely to become a significant factor, as well as an understanding of the possible costs in terms of capital expenditure and pressure on margins.

These issues matter to all investors. Gains by Big Tech company shares have been the engine of this year’s US stock market rally, so if these earnings disappoint the whole market will be vulnerable to a correction.

One more thing . . . 

Someone will be celebrating this week. British pop icon Mick Jagger turns 80 on (Ruby) Wednesday, providing me with an excuse to share one of Lucy Kellaway’s great FT essays, explaining the enduring attraction of the Rolling Stones and how their live performances matured with age.

What do you think? Email me at [email protected] or if you’ve received this in your inbox, hit reply.

Key economic and company reports

Here is a more complete list of what to expect in terms of company reports and economic data this week.

Monday

• France, Germany, Italy, Japan, UK, US: S&P Global/Cips/HCOB manufacturing and services purchasing managers’ index (PMI) data

• Germany: monthly retail sales figures

• Results: Cranswick Q1 trading statement, Domino’s pizza Q2, Julius Baer H1, Moneysupermarket H1, Philips Q2, Ryanair Q1, Vodafone Q1 trading update

Tuesday

• IMF World Economic Outlook update

• Germany: Ifo business climate survey

• Indonesia: interest rate decision

• South Korea: Q2 GDP figures

• Results: Alphabet Q2, Alstom Q1, Akzo Nobel Q2, Brown & Brown Q2, Compass Group Q3 trading update, Corning Q2, Dassault Systèmes Q2, Deutsche Börse H1, Games Workshop FY, General Motors Q2, Kimberly-Clark Q2, Kuehne+Nagel H1, LVMH H1, Microsoft Q4, Mitie Q1 trading update and AGM, Randstad Q2, Reach H1, Rémy Cointreau Q1 sales, Snap Q2, Spotify Q2, Tata Motors Q1, UniCredit H1, Unilever H1, Verizon Communications Q2, Visa Q3, Whirlpool Q2, Wickes Group Q1 trading update

Wednesday

• Australia: June consumer price index (CPI) inflation rate data

• US: Federal Open Market Committee July interest rate announcement

• Results: Airbus H1, AT&T Q2, Banco Santander Q2, Boeing Q2, British American Tobacco Q2, Carrefour Q2, Chubb Q2, Coca-Cola Company Q2, Danone H1, Deutsche Bank H1, eBay Q2, Enel H1, Equinor Q2, GSK Q2, Heathrow H1, Hilton Worldwide Holdings Q2, Just Eat Takeaway H1, Lloyds Banking Group H1, Meta Platforms Q2, Michelin H1, Nissan Motor Q1, Reckitt Benckiser H1, Rio Tinto H1, Seagate Technology Q4, Stellantis H1, Union Pacific Q2

Thursday

• EU: European Central Bank interest rate announcement

• Germany: GfK consumer climate survey

• US: Q2 GDP and consumer spending figures

• Results: Anglo American H1, ArcelorMittal Q2, Banco Sabadell Q2, Barclays H1, Beazley H1 trading update, BNP Paribas Q2, Bristol Myers Squibb Q2, Britvic Q3 trading statement, BT Group Q1 trading update, Groupe Casino H1, Centrica H1, CMC Markets Q1 trading update, Comcast Q2, CVS Group trading update, EDF H1, Elementis H1, Ford Motor Company Q2, Foxtons H1, Frasers Group FY, Geox H1, Hammerson H1, Inchcape H1, Informa H1, Intel Q2, ITV H1, Jupiter Fund Management H1, Kering H1, L’Oreal H1, McDonald’s Q2, Mercedes-Benz Q2, Mobico Group H1, Nestlé H1, Renault H1, Rentokil Initial H1, Roche H1, Sage Q3 trading update, Samsung Electronics Q1, Schroders H1, Shell Q2, Singapore Airlines Q1, TotalEnergies H1, Unibail-Rodamco-Westfield H1, Vivendi H1, Volkswagen H1, Willis Towers Watson Q2

Friday

• France: flash Q2 GDP figures and preliminary June CPI and harmonised index of consumer prices (HICP) inflation rate data

• Germany: preliminary June CPI and HICP inflation rate figures

• Japan: Bank of Japan monetary policy meeting interest rate decision

• Spain: Q2 GDP figures

• US: June personal income and spending figures

• Results: Air France-KLM H1, Aon Q2, AstraZeneca H1, Aston Martin Lagonda H1, Bouygues H1, Capgemini H1, Chevron Q2, Colgate-Palmolive Q2, Co-operative Bank H1, CNH Industrial Q2, Eni H1, ExxonMobil Q2, IAG Q2, NatWest H1, Procter & Gamble Q4, Standard Chartered H1, T Rowe Price Q2, YouGov FY trading statement

World events

Finally, here is a rundown of other events and milestones this week.

Monday

Tuesday

Wednesday

• Australia: New Zealand, Tonga: US secretary of state Antony Blinken begins a tour of the three countries to discuss regional security and co-operation and attend the Fifa Women’s World Cup football tournament

• US: President Joe Biden’s son Hunter set to appear in front of a federal court in Wilmington, Delaware, to face misdemeanour tax and gun-related charges.

• Rolling Stones frontman Mick Jagger turns 80

Thursday

• Korea: 70th anniversary of armistice signed during the Korean war, although North and South Korea officially remain at war.

• Russia: St Petersburg hosts the second Russia-Africa summit and economic forum, starting today.

• US: President Joe Biden welcomes Italian prime minister Giorgia Meloni to the White House.

Friday

Saturday

• UK: 2023 Cowes Week, the world’s largest and longest-running international sailing regatta, begins on the Isle of Wight.

Sunday

• Central African Republic: referendum on President Faustin-Archange Touadéra’s intention to change the constitution and remove term limits, allowing him to run for a third term in 2025.

• Russian Navy Day, when the country shows off its latest warships, weaponry and aircraft.