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LGT Navigator: Kick-off to the corporate earnings season

July 13, 2021

In the run-up to the eagerly awaited corporate reporting season for the second quarter, investors on the stock exchanges were confident, as reflected in new record highs for some indices. The start of the earnings season will be made by the major American banks JPMorgan, Bank of America and Goldman Sachs. In addition, attention is also the upcoming data today on the inflation trend in the US – in May, this had reached the highest level in 13 years.

Kick-off to the corporate earnings season

The Dow Jones Industrial gained +0.36% to 34,996.18 points at the start of the week and climbed during the day for the first time since the record high in May again above the mark of 35,000 points. The broad S&P 500 reached a new record high at the same time and went out of trading with a daily gain of +0.35% at 4,384.63 points. Also, on the Nasdaq technology exchange, the indices quoted new record highs on Monday. The technology selection index Nasdaq 100 closed +0.35% higher at 14'877.89 points. In Europe, the stock indices also recorded a positive start to the week for the majority. The EuroStoxx 50 gained +0.62% to 4,093.38 points and the German Dax reached a record high of 15,806 points on Monday. In Asia, the stock indices are mostly in positive territory. In Tokyo, the Nikkei 225 is up +0.55% to 28,726 points and in Hong Kong, the Hang Seng is even up +1.6% to 27,957 points.

In addition to the first quarterly reports from the U.S., the focus this afternoon at 2:30pm (CET) will also be on the latest data on US consumer prices, which provide information on the inflation trend and thus the direction of the Federal Reserve (Fed). 

ECB chief Lagarde feeds the expectation

After ECB President Christine Lagarde let slip that “adjustments and changes” are to be expected at the next meeting of the Central Bank Council on July 22 in the wake of the central bank's strategy adjustment, the tension has risen noticeably. After the ECB adjusted its monetary policy strategy last week and communicated not only a new inflation target but also increased consideration of climate aspects, the central bank could announce details on implementation. Among other things, the focus is likely to be on Forward Guidance, or the orientation of monetary policy, or the future of the temporary pandemic purchasing program PEPP.

OECD leading indicators signal steady economic growth

The Organization for Economic Co-operation and Development (OECD) leading indicator, up +0.25% in June, points to a continued recovery and above-trend GDP growth in most major economies. The OECD leading indicators are said to detect early signs of economic turnarounds. The leading indicator for the eurozone improved the most in June (+0.32%), followed by the US (+0.24%), China (+0.19%) and Japan (+0.15%).

Economic Indicators July 13

MEZ Country Indicator Last period
08:00 GE Consumer Prices (June, y/y) +2.4%
08:45 FR Consumer Prices (June, y/y) +1.8%
12:00 EZ Meeting EU Finance Minister
14:30 US Consumer Prices (June, m/m) +0.6%
14:30 US Consumer Prices (June, y/y) +5.0%
14:30 US Core Consumer Prices (June, y/y) +3.8%

 

Earnings Calender July 13

Country Company Period
AUT Telekom Austria Q2 
US JPMorgan Chase Q2
US Goldman Sachs Q2
US PepsiCo Q2

 

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Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi, +41 44 250 78 59, E-Mail: lgt.navigator@lgt.com
Source: LGT Bank (Switzerland) Ltd.

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