What to Watch in the Week Ahead and on Monday, December 16
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ON MONDAY
It will be a data-heavy week in the U.S. with S&P Global flash PMIs for December scheduled for release on the first day of the week. The S&P Global flash manufacturing PMI reading is expected to come in at 49.8 and the flash services PMI at 55.7. The flash composite PMI is also on the radar. Additionally, the NY Fed Manufacturing reading for December is projected to be at 12, down from 31.20 recorded in the previous month.
Bank of Canada Governor Tiff Macklem is scheduled to address businesses at the Greater Canada Board of Trade in Vancouver.
On the Canadian economic radar is the country's housing starts data. The seasonally adjusted annualized rate of housing starts likely rose to 248,200 units in November from 240,800 units in October.
REST OF THE WEEK
The U.S. Federal Reserve will convene its monetary policy meeting on Tuesday and Wednesday and is expected to announce a quarter-percentage-point cut in the benchmark interest rate at the conclusion of the meeting. Investors are keenly awaiting comments from Fed Chair Jerome Powell to get an insight into the central bank's assessment of the U.S. economy and its rate-cut trajectory.
A multitude of U.S. economic data are scheduled for release in the week. The PCE Price Index for November is due on Friday, which is expected to have edged up 0.2% on a month-on-month and 2.5% on an annual basis. Core PCE Price Index is projected to have gained 0.2% last month and 2.9% in the 12 months through November. Consumer spending is also due the same day and is likely to have ticked up 0.5% in November. Separately on Tuesday, the Commerce Department's Census Bureau is set to report retail sales in November rose 0.5% after edging up 0.4% in the previous month. Additionally, business inventories likely edged up 0.1% in November. The bureau will also report capacity utilization for November likely ticked up to 77.3% from 77.1% in October. The same day, the Federal Reserve is set to report that industrial production likely inched up 0.3% in November after falling 0.3% in the previous month. The country's third-quarter final GDP number is due on Thursday, which is expected to remain unrevised at 2.8%. The current account data for the third quarter is due for release on Wednesday. A report from the Labor Department on Thursday is likely to show initial claims for state unemployment benefits fell 13,000 to a seasonally adjusted 229,000 for the week ending Dec. 14. Separately, the University of Michigan's final Consumer Sentiment Index for December likely remained unchanged at 74%.
Among housing data, U.S. existing home sales is due on Thursday, while housing starts and building permits are releasing on Wednesday. Home sales is forecast to have risen to a seasonally adjusted annual rate of 4.05 million units from 3.96 million units recorded in the previous month. Meanwhile, single-family housing starts likely rose to a seasonally adjusted annual rate of 1.342 million units last month from 1.311 million units posted in October. Building permits is forecast to have increased to a rate of 1.431 million units from 1.419 million units. Separately, on Tuesday, the National Association of Home Builders/Wells Fargo Housing Market Index is projected to have risen to 47 in December from 46 in the previous month.
Drugmaker Pfizer is expected to provide its 2025 profit forecast on Tuesday, a little over a year after it unveiled an aggressive cost-cutting program. The company, which has been under pressure from activist hedge fund Starboard Value, is also expected to provide expectations around sales of products such as its COVID-19 vaccine and its newer cancer drugs.
Cheerios maker General Mills is expected to post a decline in second-quarter revenue on Wednesday, hurt by weaker demand for its breakfast cereals, snack bars and pet foods. Investors will look out for comments on demand, pricing actions, the impact of input costs, comments on the impact of recent acquisition and annual forecasts.
Nike is expected to post a fall in second-quarter revenue on Thursday, hurt by weak demand for its apparel and shoes amid intense competition from Roger Federer-backed On and Deckers' Hoka. Investors will look for new CEO Elliott Hill's vision for the company, any new turnaround plan and how the company would battle potential tariff hikes under the new Trump administration.
On Thursday, Darden Restaurants is expected to report a growth in second-quarter revenue, helped by higher menu prices and steady demand at its high-end Olive Garden and LongHorn Steakhouse chains. Investors will look out for comments on annual forecast updates, pricing strategy, restaurant traffic and cost control.
Cruise operator Carnival Corp is expected to post a rise in fourth-quarter revenue on Friday, helped by strong demand for cruise vacations. Investors will look out for comments on demand, pricing, impact of ports, labor and fuel costs as well as annual forecasts.
On Wednesday, Birkenstock is expected to post a rise in fourth-quarter revenue as consumers shop for the German sandal maker's pricey sandals. Investors will watch out for spending trends during the holidays and the company's expectations for 2025.
On Tuesday, Statistics Canada is scheduled to report the country's inflation in November, which likely edged up 0.1%, easing from 0.4% recorded in the previous month. On an annual basis, inflation likely remained steady at 2%. On Friday, the country's retail sales data is due, which is forecast to have ticked up 0.7% in October after rising 0.4% in the previous month.
In Latin America, the Mexican central bank will announce its interest rate decision on Thursday. The current benchmark interest rate in the country is at 5.25%. Separately on Wednesday, Argentina is likely to post a trade surplus of $708 million for November, down from a surplus of $888 million posted in October. According to a report, to be released on Friday, the country's economy is expected to have contracted 2.5% in October. Separately, Chile's central bank is scheduled to announce its interest rate decision on Tuesday.
Reporting by Ananya Roy in Bengaluru; Editing by Vijay Kishore
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