Monday 17 June
- Rightmove UK house price index
- Chinese industrial production, retail sales and fixed asset investment growth
- G7 meeting starts in Puglia, Italy (runs all week)
- In Europe, quarterly results from H&M
- In the US, quarterly results from Lennar
Tuesday 18 June
- Full-year results from Telecom Plus
- Trading updates from Whitbread and SThree
- Interest rate decision from the Reserve Bank of Australia
- EU inflation figures
- German ZEW economic sentiment survey
- US retail sales
- US industrial production and capacity utilisation rate
- Ashtead full-year results
Ashtead, an international equipment rental company, will release its full-year results on Tuesday.
The company does the majority of business in the US under the name Sunbelt, which makes up about 85% of sales and 90% of profits.
Russ Mould, AJ Bell investment director, Danni Hewson, AJ Bell head of financial analysis, and Dan Coatsworth, AJ Bell investment analyst, said: “This could make the company a good litmus test of the US economy, even as it continues to take market share and supplement organic growth with acquisitions, although a lot attention may also go to rumours that the FTSE 100 member is considering a switch in its stock market listing to New York from London, as well as the launch of the firm’s Sunbelt 4.0 strategic plan.”
Ashtead issued a profit warning in 2023, anticipating 11-13% year-on-year growth, pointing to Hollywood strikes and a temperate hurricane season in the US.
However, the AJ Bell team also pointed to other areas of the market that may influence performance, such as home sales and the Institute for Supply Management’s purchasing managers’ index for manufacturing industries, which has come in on the lower end in the past 18 months.
“Renewed weakness in new homes sales, which have consistently ebbed since May 2023 thanks to a 30-year mortgage rate that now stands at 7.00%, is also a trend to be watched,” the AJ Bell team said.
“Interest rate cuts from the US Federal Reserve could help here, in the event of any prolonged weakness, even if markets now expect only two one-quarter point reductions in 2024, down from initial expectations of six.”
Currently, analysts predict a total sales growth of 12% for the year and earnings of $2.1bn, slightly down from the 2023 fiscal year.
Wednesday 19 June
- Full-year results from Berkeley Group and Young’s Brewery
- UK inflation
- US NAHB housebuilding industry survey
- In the USA, quarterly results from Accenture, Kroger, Darden Restaurants, Jabil and Winnebago
Thursday 20 June
- Full-year results from Syncona and Urban Logistics REIT
- China one- and five-year interest rates
- Interest rate decision from the Swiss National Bank
- US building permits
- US housing starts
- US oil inventories
- US weekly initial unemployment claims
- In the US, quarterly results from Accenture, Kroger, Darden Restaurants, Jabil and Winnebago
The Bank of England will announce its monetary policy decision on Thursday, following a cut by the European Central Bank but a hold by the Fed.
“The Bank of England is yet to join the cavalcade of rate cutters and its job may have been slightly complicated by both the calling of a general election for 4 July and the last batch of inflation data,” Mould, Hewson, and Coatsworth said.
“Governor Andrew Bailey and his colleagues on the Monetary Policy Committee may not wish to act in any way that could be seen as favouring one political party over another in the run up to July’s poll, while April’s inflation data was a little hotter than expected, even if the rate of increase decelerated to 2.3% from 3.2% in the prior month.”
The Bank of England is currently running a Quantitative Tightening programme as well as cutting holdings in bonds and gilts. Bailey has previously stated an ideal holding level between £345bn and £490bn.
The AJ Bell team also noted that the Bank of England must be mindful of the Fed’s goals in order to not devalue the sterling.
“Although the Bank of England is now expected to follow the ECB’s example and move before the US Federal Reserve, the degree to which UK rates can diverge from those in America could still limit the MPC’s room for manoeuvre,” Mould, Hewson, and Coatsworth said.
“Too big a gap between the UK base rate and the Fed funds rate could suck capital out of sterling and into dollars, weakening the British currency, at the risk of boosting inflation thanks to how the UK buys and imports more than it sells and exports.”
While analysts still feel a June rate cut is unlikely, a reduction by September seems more plausible, according to the AJ Bell team.
Friday 21 June
- Flash purchasing managers’ indices (PMIs) for manufacturing industries from Japan, Asia, Europe, UK and US
- US existing homes sales
- In the US, quarterly results from CarMax
