20 January 2012 at 8:54 GMT
While most of Asia will indeed be off next week to celebrate the Lunar New Year festivites it seems as if the Western world is trying to emulate Asia offering us a rather dull calendar to end the week with only a few economic reports, one major earnings release (GE at 11:30 GMT) and no auctions to speak of. Overnight China reported that the unofficial (HSBC) PMI Manufacturing Index had risen slightly to 48.8 from 48.7 in January - though this is still showing contraction in the sector.
Andrew Robinson has more on the overnight session.
Existing Home Sales rally into year-end in the US: As we have mentioned several times this week (e.g.
here) we expect the housing market to again this year continue the recent showings of strength seen in 2011, albeit it will not be speedy by any standards. Pending Home Sales track sales of existing homes at an earlier stage than the actual Existing Home Sales and hence serve as a solid indicator of the latter, typically leading 1-2 months. Pending Home Sales have risen sharply in recent months and are up 13 percent quarter-on-quarter suggesting rising sales of existing homes in the coming months. Consensus agrees, expecting an increase of 5.2 percent month-on-month to 4.65 million sales (annualised) in December after a 4 percent rise in November.
UK Retail Sales expected to climb, Canadian inflation to ease, GE earnings to improve: Before US Existing Home Sales we have December UK Retail Sales where the expectation is for sturdy gains of 0.6 or 0.7 percent depending on whether you include auto fuel or not. If realised this would erase the horrible showing in November when sales at retailers declined 0.7 and 0.4 percent, respectively.
Canadian inflation is expected to ease 0.2 percent at the consumer level in December to take annual CPI inflation down to 2.7 percent from 2.9 percent in November and 3.7 percent at the peak in May 2011.
Anaylsts look for General Electric to present fourth quarter (2011) earnings of $0.379 per share, up from $0.36 in 4Q'10 and $0.31 in 3Q'10. The stock is up roughly 30 percent to 19.15 since late November 2011 having spent most of 2H'11 in the $15-16 range. More on GE in our Equity Update later.