1. Tuesday, Wednesday and Thursday 31 Jan-2 Feb: central banks take centre stage
Tuesday 31st: Bank of Japan. The BoJ has tinkered with its QE scheme so its target is to cap 10-year Japanese Government Bond yields (JGBs) at zero – they have risen to 0.08% so this is a key test, unless the BoJ is to step back and start tightening policy (which no-one seems to expect).
Wednesday 1st: US Federal Reserve. The Fed has pointed toward three interest increases of 0.25% for 2017, having squeaked out one in each of 2015 and 2016. The market puts a 3% chance on a rate rise at this meeting, in light of the weak Q4 GDP number last Friday and June is the favourite for the first hike. But there’s only a 25% chance put on three increases this year, even as Yellen questions whether the Trump fiscal stimulus is needed, Trump criticises low interest rates, unemployment falls and inflation rises. Both chair Yellen and vice-chair Fischer have to be reappointed (or not) by Trump in February 2018.
Thursday 2nd: Bank of England. The market is currently looking for the first UK rate rise in 2019 and the Governor Carney is unlikely to tinker with the additional £70 billion of QE launched last August. That said, he has begun to express mild concern about rising inflation and sharp increases in consumer borrowing (credit card debt is growing at its fastest level since 2005).
2. Tuesday 31 January: Third-quarter statement from SSE
Electricity utility and FTSE 100 member SSE has three specific financial targets for its 2016-17 financial year:
First, it is looking to deliver a dividend increase that at least keeps pace with retail price inflation, while maintaining earnings cover in the 1.2 to 1.4 times range.
Second, SSE is targeting growth in earnings per share to at least 120p
Third, the utility is planning to invest around £1.85 billion in its business as part of a £4 billion four year plan to March 2020.
Also keep watch for comments on the £500 million share buyback programme.
3. Thursday 2 February: Full-year results from Royal Dutch Shell
The oil giant is the biggest company in the FTSE 100 by stock market valuation at nearly £190 billion (or just under 10% of the index all on its own) and it generates around 12% of the benchmark’s total sales, 6% of profits and 15% of dividends on its own.
Oil prices have rallied from below $30 a year ago to $55 but Shell’s upstream (exploration and production) arm is expected to have made a $2.5 billion loss last year while downstream (refining, chemicals and petrol stations) are expected to have made a $7.6 billion profit.
Also watch for further updates on the $30 billion asset disposal programme, capital expenditure budgets (forecast $29 billion in 2016, down from $47 billion in 2015, with a run rate of $25-30 billion for 2017 and 2018) and cost cuts, as Shell continues to integrate 2016’s huge acquisition of BG, where the budgets included oil prices much higher than we have today to make the deal price add up.
Analysts will be looking at how Shell intends to sustain the forecast (unchanged) dividend of $1.88 per share – which earnings will barely cover by half in 2016.
OTHER NEWS ITEMS TO WATCH:
Tuesday 31 January
Full-year results from online grocer Ocado
Trading statements from Britvic and Carpetright
UK consumer confidence survey from GfK
UK mortgage applications data from Bank of England
Inflation and unemployment figures from the Eurozone
In the US, quarterly results from Apple, ExxonMobil, Pfizer and Yahoo!
Wednesday 1 February
Trading statements from TalkTalk Telecom
Industrial sentiment surveys (Purchasing Managers Indices, or PMIs) from China, the UK, Europe and the USA
ADP job creation numbers in the USA
US car sales figures
US oil inventory data
In the USA, quarterly results from Mondelez (formerly known as Kraft and owns Cadbury) and Facebook
Thursday 2 February
Full-year results from FTSE 100 drug giant AstraZeneca
Trading statements from Aberdeen Asset Management, Johnson Matthey and Vodafone
UK construction industry sentiment survey (Purchasing Managers Index, or PMI)
Challenger job cuts survey in the USA
In Europe, quarterly results from Nokia
In the USA, quarterly results from oil company Conoco Phillips, General Motors, Merck and Visa
Friday 3 February
UK services industry sentiment survey (Purchasing Managers Index, or PMI)
USA services industry sentiment survey (Purchasing Managers Index, or PMI)
US non-farm payrolls employment and wage growth data
US factory orders
In the USA, quarterly results from oil company Phillips66