This is it. Next week will be the final Fed interest-rate decision for the year. The FOMC is expected to cut the cost of money by 0.25% to 4.5%, even though inflation is sticky. It seems that the Fed could be more concerned about weakness in the labour market than the price of goods on American supermarket shelves.
Staying with inflation, the Fed’s favourite gauge for consumer prices, namely, the Personal Consumption and Expenditure Index (PCE) for November will be released on Friday. It is expected to show an increase of 0.2% to 2.5% from the previous month. The core PCE index is also expected to show a small uptick to 2.9%.
The Bank of Japan is expected to stand pat on interest rates at 0.25%. The policy board has said that it remains committed to raising rates. But it is more concerned about the increasing uncertainty of the global economic outlook. Elsewhere, Bank Indonesia could keep interest rates unchanged at 6%.
It could be a tale of two shoppers next week. In China, retail sales growth could have slowed from 4.8% in October to 4.5% in November. But in the US, retail sales growth could have jumped from 2.8% to 3.8%.
Corporate Events
General Mills (NYSE: GIS), which is behind brands that include Cheerios and Pillsbury, has been hurt by an uncertain economic backdrop. In September, the cereal maker posted a drop in both first-quarter revenue and profit, as lower prices and higher costs weighed on its performance.
Chipmaker Micron Technology (Nasdaq: MU) has projected that its first-quarter revenue would come in at US$8.7 billion. It also expects to report earnings of US1.74 per share, which would be a significant turnaround from last year’s loss of US$0.95 per share. The company should benefit from the growing demand for memory chips in tandem with the surge for AI technologies.
Nike (NYSE: NKE) is facing falling revenues in both North America and China. At the same time, it facing declining profit margins. For the second quarter, the sportswear company could report better profit, thanks to tighter cost control. But revenue could continue to disappoint.
Companies looking to adopt AI as part of their business models are turning to Accenture (NYSE: ACN) for guidance. The business consultant expects to report revenue that grew between 2% and 6% in the first quarter.
FedEx (NYSE: FDX) is considered to be a bellwether for the US economy. And based on its first-quarter results, America might not be doing as well as the economic data suggests. The company has also lowered its profit outlook.
There are also results from comfy-shoe maker Birkenstock (NYSE: BIRK), cruise-ship operator Carnival (NYSE: CCL), food producer Conagra Brands (NYSE: CAG) and software company BlackBerry (Nasdaq: BB). Also pencilled in for results is Malaysian glover maker Top Glove (KLSE: 7113).
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DKIP owns shares in Top Glove.
