Look ahead 29/11/23: German CPI; Fed Beige Book; Halfords, Dollar Tree, Foot Locker earnings

(Video Transcript)

Germany’s consumer price data due

Hello, I'm Angeline Ong, and welcome to your look ahead to Wednesday, 29 November 2023. We start in Germany, where we have consumer price data. This is for November, and the expectations are for 3.5% year-on-year after 3.8% reading in October.

From the US, the big one to look out for will be the Q3 GDP growth rate. This is, of course, a second estimate, so perhaps the more interesting data points will be the wholesale inventories, the Federal Reserve (Fed) base book, of course, and EIA.

EIA is out with its crude oil inventories in a week when the Organization of Petroleum Exporting Countries Plus (OPEC+) delayed meeting is taking place, and also COP28 in Dubai.

Just having a look at the US 500 here, see, because this index is gradually creeping up towards that 4,600 mark, but it has somewhat reached a sort of plateau around 23 November. And we are seeing the markets, not just the US 500, but also Wall Street starting to have this wait-and-see stance, perhaps for more economic data.

Investors hope for end to rates increase cycle

And with the multitudes of Fed speakers speaking this week for more hints on where the Fed's rate cycle is heading, in the last few sessions, expectations that the Fed's rate increase cycle has finally come to an end has put upward pressure on equities and also downward pressure on the greenback, and that has also helped gold prices.

US rate futures now indicating that we might see a rate cut as soon as March, and that expectation increases to around 50% by May. This is according to the CNE FedWatch pool.

Now, just a reminder as well, we also have quite a few earnings still, and we've got Halfords out with first-half earnings out of the UK.

Halfords is a really interesting one. Let me just show you the chart, because Halfords was a darling during the lockdown because it has positioned itself well, selling bicycles and all sorts of services related to that, and also car parts.

The bicycles retailer, just to remind you, earlier this month expressed interest in a bid for Wiggle CRC, and that's according to Sky News. For those of you that don't know Wiggle, it's an online platform that allows you to buy all manner of things for bicycles, including jerseys and pedals and things like that.

US consumers becoming more cost-conscious

Now, Halfords has seen its share price sort of languish after lockdown was lifted, and it has been slowly trying to regain momentum, if you like. However, it's hit this resistance point at $2.35, $2.40, and struggled to make headway above that.

From the US, look out for Dollar Tree. This is the discount retailer in a week where we see a lot of indicative data out from the Saturday, Monday and Thanksgiving weekend.

For the retailers, what's interesting is to keep your ears open for any indication that shows that consumers are still spending, especially in the US. However, they are starting to become more cost-conscious, and this can also be seen in terms of in their online trends that are slowly tripling out as we speak.

Online and those retailers that have a buy-now-pay-later service are looking anecdotally to have done better. Dollar Tree, this is the Virginia-based company, expected to report a 6.6% rise in revenues to around $7.4 billion from almost $7 billion a year ago.

Well, that's it for now. Do tune in for more market-moving news on Twitter, where you'll find me on @AngelineOng, or do tune in every weekday.

I'll be back on beat the street at 1.30pm London time to give you a heads-up to the US trading session, and IG's Jeremy Naylor will be on at 7.30am on early morning call to do the same for the European trading day. This is IGTV.