May 10, 2021 | by sandeep
5 Issues to Look Out for This Week – 10/5/21
By Mateo Jarrin Cuvi
Plenty of action this week starting off with some earnings reports followed by UK GDP, US CPI and retail sales, and a surging black gold. Tune in and roll out those trades!
Tech, Cartoons & China’s Tesla This Week!
We’ve got a varied group of equities for you to trade starting on Monday, May 10th.
Check out this week’s earnings reports below and get your reading glasses ready!
Who: Trade Desk Inc (.TTD.OQ)
Day: Monday, May 10
Time: 11 am GMT
Note: The Trade Desk, Inc., a company that provides a global technology platform for buyers of advertising, has easily surpassed its past two earnings projections, averaging a staggering surprise of 127.22%. Can we expect the same for this quarter that just passed? EPS for Q1 2021 is set to be close to $0.37.
Who: Paysign Inc (.PAYS.N)
Day: Tuesday, May 11
Time: 9:00 pm GMT
Note: Will Paysign, a firm that offers prepaid card programs, digital banking services and payment processing, recover its share of business in the pharma and plasma industries following COVID-19? The company wrapped up 2020 with $7.8 million in unrestricted cash and zero debt on its balance sheet, so it seems positioned to move in the right direction this year. EPS for Q1 2021 should be -$0.01.
Who: Walt Disney (.DIS.N)
Day: Thursday, May 13
Time: 8:05 pm GMT
Note: Will Mickey Mouse’s home company experience a fourth consecutive quarter of double-digit declines in revenue? Or will the success of Disney+ push it over the hump? Q2 should see a reopening of its theme parks and a return to the movie theatres with Cruella, but that does not particularly help these numbers. EPS for Q1 should be $0.27 or so.
Who: XPeng Inc (.XPEV.OQ)
Day: Thursday, May 13
Time: 12:00 pm GMT
Note: XPeng, a Chinese electric vehicle manufacturer, is expected to continue to grow, providing cheap EV options to buyers in the world’s largest market. Following a stellar 2020 during which the company doubled its number of cars sold and released a new sedan model, is the Chinese “Tesla” bound for more success in 2021?
Mark these dates on your agenda and prepare to trade these equities!
A British Bounceback on the Cards?
Following a disastrous 2020, will the UK economy’s bounceback kick off in Q1 2021?
Some analysts predict a minute growth for UK GDP during this quarter, suggesting it will register at around 0.5% following the 1.3% growth seen for the last three months of 2020.
Deloitte, however, is a bit less optimistic and believes UK GDP will contract by 1.7%.
Regardless of this, the Big Four firm predicts the UK will “rebound strongly as restrictions are eased gradually over the second and third quarters, supported by the vaccine rollout, extended UK fiscal support and the boost to global growth from the large US fiscal stimulus.”
Find out on Wednesday, May 12th when the UK releases preliminary data for this quarter’s GDP at 6:00 am GMT what road lies ahead for the UK’s finances.
An economic recovery should be in the works, so get those GBP trades ready!
Some Like It Hot!
Are there inflationary concerns in the US these days? Or are the current price spikes a one-off event resulting from the pandemic?
The US Fed is not entirely concerned by this heating up of the economy and thinks inflation will remain within its preferred range of 2 to 2.5%.
Still, as reported by The Financial Times, “a measure calculated by the Minneapolis Federal Reserve based on options trades suggests a one-in-three chance that the US consumer inflation rate climbs above 3 per cent over the next five years.”
Mickey Levy, a chief economist at Berenger Capital Markets, concurs, telling MarketWatch that “PCE inflation will likely rise to 3% and the core PCE inflation close to 2.5%.”
“Although these sharp spikes will dissipate, we anticipate the robust growth in aggregate demand will support more sustained inflation pressures,” Levy adds.
Considering all this uncertainty, investors this year have already purchased $14.4 billion worth of inflation-protected US Treasuries to safeguard their money.
Let’s see about this inflationary pressure on Wednesday, May 12th when the US announces its latest CPI data at 12:30 pm GMT!
Are Oil Prices on the Mend?
Oil seems to be in recovery mode following a disastrous 2020.
Despite the ongoing humanitarian crisis in India, the successful vaccine rollouts in the US and Europe have bode well for oil with many analysts suggesting prices could rise to $80 per barrel this summer.
Likewise, the easing of restrictions in both regions and a significant drop in US oil inventories in previous weeks are providing additional support to prices at their current levels.
Last week alone, crude oil inventories in the US fell by 8 million barrels, a steep decline considering Reuters’ prediction of a 2.3 million barrel decrease for the week.
According to Citi analysts, “as the rollout of vaccines continues and a pent-up summer driving season continues to manifest, this trend should accelerate, keeping demand for motor fuels robust and boosting market confidence in the recovery story.”
Find out Wednesday, May 12th when the US EIA releases its weekly crude oil inventory report at 2:30 pm GMT if both demand and the price of black gold are on their way up!
Shop! Shop! Shop!
There are high expectations for US Retail Sales in April following an impressive 9.8% growth in March.
As reported by CNBC, “sporting goods, clothing and food and beverage led the gains in spending and contributed to the best month for retail since the May 2020 gain of 18.3%, which came after the first round of stimulus checks.”
More specifically, sporting goods gained 23.5%, clothing and accessories 18.3%, and car parts and dealerships 15.1%, while the food and beverage sector, boosted by the vaccine rollout and the slow reopening of the economy, surged by 13.4%
Despite this obvious success, the last of the stimulus packages have been distributed and employment is still in recovery mode, so it doesn’t look like these gaudy numbers will be matched.
In any case, pay close attention to the latest figures to be released Friday, May 14th at 12:30 pm GMT and let’s get ready to trade USD!
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