Monday 6 July
UK construction industry purchasing managers’ index (PMI) – June
May’s construction PMI came in at an abysmal 28.9, but that was still a vast improvement of the 8.2 reading in April.
US ISM non-manufacturing purchasing managers’ index (PMI)
AJ Bell investment director Russ Mould notes the current downturn is unusual in that services and consumption are bearing the brunt of it rather than manufacturing “and that is a huge issue for an economy where consumption represents 70% of GDP”. The non-manufacturing PMIs were 45.3 in the May reading, up from 41.8 the previous month, but still below the 50 mark and therefore indicating contraction rather than growth.
Tuesday 7 July
Whitbread Q1 update
Mould notes analysts currently forecast a drop in revenue per available room of 90% with Whitbread’s hotels largely closed during the period. “It is highly unlikely that CEO Alison Brittain will feel able to give any guidance for the full-year to February 2021, given the uncertainty over how British and German consumers will feel about booking and staying in hotels, even now they are permitted to do so, for either economic or health reasons. Summer staycations could potentially be a boon, although any recovery in overseas visitors or business guests is even harder to predict and could well come much later.”
Mould notes the business said in May it would be able withstand 18 months with no business at all given that it had access to £950m in untapped borrowing facilities, was eligible for £600m in support from the Bank of England’s Covid corporate financing facility and already had £500m in cash at hand. It has since raised a further £1bn through a rights issue.
US job openings and labour turnover survey
The renewed lockdown in Texas and fresh outbreaks in Florida and Arizona represent the backdrop for the latest job openings number out of the US. The survey peaked at 7.5 million in February but had fallen to 5 million by April, the lowest mark since December 2014.
Reserve Bank of Australia
The central bank interest rate currently sits at 0.25%, its lowest ever level, as the country prepares itself for its first recession in nearly 30 years.
Full-year results from JD Sports Fashion and Halfords
H1 results from Micro Focus
Trading statements from media group Reach and iron ore producer Ferrexpo
Halifax House Price Index in the UK
German industrial production data
Wednesday 8 July
Chancellor Rishi Sunak presents the financial statement in the House of Commons
The chancellor reveals more details on the UK government’s plans to tackle the economic fallout from the coronavirus.
Sunak has reportedly already warned Conservative MPs there will not be big tax breaks on offer, although a reduction on VAT could be on the cards. There are reports the chancellor may go in the other direction and introduce a wealth tax.
In the pensions space, the triple lock could be deemed unaffordable in the age of coronavirus.
Sunak is also set to provide more detail on how the government plans to phase out the furlough scheme currently supporting a vast number of employees across the UK and will also provide details on Boris Johnson’s plans to “build, build, build” the UK out of the looming economic recession.
Royal Institution of Chartered Surveyors (RICS) Housing Survey – June
Improvements in the latest housing survey could add confidence that the coronavirus pandemic has caused only a temporary blip in the housing market, says Canaccord Genuity Wealth Management investment manager Dan Smith. “The coronavirus pandemic brought an abrupt halt to housing activity and predictions of sharp falls in house prices,” Smith says. “However, recent indicators have offered glimmers of hope of a revival in fortunes, with the RICS housing survey showing an improvement in new buyer enquiries and sales expectations in May.”
Full-year results from FirstGroup
Trading statement from Barratt Developments
US oil inventory data
Thursday 9 July
Robert Walters Q2 trading update
In response to the coronavirus, Robert Walters has thus far cancelled its final dividend, cut costs by 15% and trimmed executive salaries. Mould says, as a recruitment company, Robert Walters has a finger on the pulse of the economy. The fact group headcount was cut 2% in the first quarter isn’t necessarily a bullish sign for the future, he says.
German exports – May
German exports recorded their worst ever monthly declines in April, dropping 24% month on month. Smith says by contrast May’s numbers could show the biggest ever monthly rise, as the reopening of economies leads to a pick-up in economic activity. “The extent of the recovery in exports will provide a good indication of how quickly the German economy is expected to recover from the crisis, while also acting as a bellwether for the health of the global economy,” he says.
Trading statements from house builders Persimmon and Vistry, builders’ merchant Grafton and London-focused business landlord Workspace
Chinese inflation data
Friday 10 July
Chinese new loans data
US factory gate (producer prices) inflation data
