Hello and welcome to the working week.
Just as offices were starting to come back to life and finding some of their old rhythm, most of us here in London will now be hunkering down for yet another period of enforced homeworking, after the government announced stricter rules in a bid to get a grip on rising cases of coronavirus and the Omicron variant.
In somewhat better news, expect strong UK labour market figures on Tuesday to show no evidence of rising unemployment since the end of the furlough scheme in September, and for inflation to rise again to about 4.5 per cent in the November figures due on Wednesday. Yet even with these signals of economic strength, the Bank of England is unlikely to raise rates, as it weighs the potential impact of Omicron.
The tighter restrictions will inevitably hit certain sectors such as retail and transport, though it could be a boon for some retailers, such as online grocery delivery companies. (UK retail sales data for November will be published on Friday.)
In the US, meanwhile, all eyes will be on the Federal Reserve’s meeting on Wednesday. Policymakers are expected to hasten the taper on quantitative easing and signal the likelihood of more interest rate rises next year, in light of growing concerns about rising inflation.
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Economic data
Economists expect the UK’s Bank of England to keep the rate at 0.1 per cent when it meets on Thursday, as the rising numbers of coronavirus infections and the emergence of the Omicron variant favour a wait-and-see approach.
US consumer inflation expectations and core producer price index (PPI) figures will be published on Monday and Tuesday. November inflation hit 6.8 per cent, and the view that a higher rate would be “transitory” is slipping away.
Companies
Two very different retailers publish updates on Tuesday, but the Omicron variant of the coronavirus matters to both. Sales growth at online grocer Ocado has slowed from last year’s peaks as some shoppers returned to stores. Will the emergence of a more transmissible variant push them back online? The share price, down 7 per cent over the past month, suggests investors don’t yet think so.
Warsaw-listed Pepco sells discount clothing and general merchandise from more than 3,000 stores, mainly in central and eastern Europe. Investor focus is likely to be on guidance for the year to September 2022 and whether the new variant could result in renewed lockdowns — some of Pepco’s key markets have vaccination rates that are well below the EU average — or a slowdown in new store openings.
Purplebricks, the UK’s biggest online-only estate agency, will reveal its half-year results on Tuesday. House prices continue to race higher, in November registering their strongest three-month growth in about 15 years, as a limited supply of homes for sale and low interest rates support the market.
Yet Purplebricks’ share price has fallen by two-thirds so far this year, hurt by a falling number of instructions and a rise in employment costs. That led it to warn last month that these interim results would be worse than expected.
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
UK, Bank of England’s latest Financial Stability Report and Financial Policy Committee Record
India, inflation data
US, consumer inflation expectations
Opec monthly report
Tuesday
UK, employment data
Pepco trading update
US, core producer price index (PPI) figures
Ocado trading update
Sodexo AGM
Canada, fiscal update
Purplebricks Group interim results
Chemring annual results
Wednesday
US, Federal Reserve interest rate decision
UK, consumer price index (CPI) and PPI data
UK house price index
Currys interim results
Russia, GDP data
Inditex Q3 earnings
Thursday
EU, ECB rate decision
UK, Bank of England MPC meeting on interest rates
Flash purchasing managers’ index (PMI) data — US, UK and eurozone
Switzerland, central bank interest rates decision
Rivian Automotive, Adobe and Go-Ahead Group earnings updates
Friday
UK, retail sales figures
Qantas market update
888 Holdings EGM
ITM Power trading update
World events
A rundown of other events and milestones this week.
Monday
US secretary of state Antony Blinken visits Indonesia and Malaysia as the Biden administration ramps up engagement in south-east Asia
Hong Kong’s District Court is expected to sentence to prison five pro-democracy activists for taking part in an unauthorised assembly at last year’s Tiananmen Square vigil
Thousands of tractors will descend on Brussels as European farmers protest against various elements in the EU Green Deal
Tuesday
Chief executives at EDF and TotalEnergies speak at a French power lobby conference
Wednesday
Australia reopens to foreign visa holders and vaccinated tourists from South Korea and Japan
The leaders of Armenia and Azerbaijan meet in Brussels. Clashes at the countries’ borders claimed at least 10 lives on November 19
Thursday
European Council summit takes place in Brussels, the first attended by Germany’s new chancellor Olaf Scholz
UK, North Shropshire by-election, which follows the resignation of Conservative Owen Paterson last month after the MP had been found to have breached parliamentary rules on lobbying
Friday
European Automobile Manufacturers Association publishes monthly figures for new passenger car registrations in Europe
Tunisia marks the 11th anniversary of the event that started the Arab Spring uprisings — the self-immolation of Mohamed Bouazizi in protest at the confiscation by police of his vegetable cart
Saturday
Taiwan will hold a referendum on the construction of a new gas terminal that has been criticised by environmental campaigners for putting the reef and ecosystem at risk
International Day of Migrants
Sunday
Chile election run-off
Legislative Council of Hong Kong election takes place after being postponed from September 2020 owing to the pandemic
Source: Economy - ft.com
