Week Ahead: 1,300+ days and counting…

Believe it or not, Donald Trump’s second US Presidency hits its first 100 days on Wednesday. If, like us, you feel you’ve aged somewhat in that short space of time, then at least we are all in this together! That means there’s roughly 1,363 more to go. Only one other president has endured a worse start in the S&P 500. No other US commander-in-chief has suffered bigger dollar losses. But Trump’s second stint in the Oval office has been among the best for gold – though that’s not typically a positive thing given its safe haven status. Is this all part of the grand plan to re-order the global system? There’s little doubt this more mercantilist shift has been chaotic and haphazard but has also given us untold trading opportunities.

It’s a busy week on the calendar front with a lot of major US data to look forward to, including the monthly US jobs report. This could tell us if we are closer to a US slowdown and potential recession. Stock markets rallied last week with a kind of “no news, is good news” vibe. Severely beaten-up sectors like tech, consumer discretionary and communication services led the gains on the S&P 500 as the benchmark index jumped 4.6%. Prices have now risen above the halfway point of this year’s high to low move and also broken a couple of short-term down trendlines. Interestingly, we see stories that big US retailers like Walmart and Target have been notifying Chinese suppliers to resume shipping goods. Does this mean the White House will substantially ease tariffs soon? Is this a ‘sell the fact’ event?  

The week is probably also the peak of the US earnings season with four of the “Magnificent 7” companies reporting – Microsoft, Meta and Amazon on Wednesday, and Apple on Thursday, all after the US closing bell. We also get many other heavy hitters like Visa and Eli Lilly to alter the risk mood. Quieter markets could leave Trump keen to announce more policies and deals., or even push the boundaries some more. That provides more volatility, especially if we get more denials by China.

In Brief: major data releases of the week

Wednesday, 30 April 2025

– Australia CPI: Q1 trimmed mean is expected to rise 0.6% and the annual pace to 2.8% from the prior 3.2%. Momentum in core inflation is currently below the midpoint of the RBA’s target range.

– Eurozone GDP: Expectations are for Q1 GDP to print at an unchanged 0.2% q/q and 1% y/y, two-tenths below the prior Q4 figure. Economic uncertainty amid tariffs and possible retaliation warns of downside risks to inflation.

– US GDP / US Core PCE: Q1 growth is expected to slow quite sharply to around 0.4% from the previous 2.4%. But there is a wide range estimates. The core PCE median forecast for April is seen at 0.08%, according to the WSJ’s Nick Timiraos. Tariffs are likely to cause an increase in input costs.

Thursday, 1 May 2025

– Bank of Japan Meeting: The BoJ will keep its interest rate unchanged at 0.5% Median forecasts for real GDP and core CPI will be released. Hot inflation will be offset by US trade policy uncertainty. Focus will be on any signals about rate hikes ahead.  

– US ISM Manufacturing: March manufacturing ISM is seen falling to 47.9 from 49.0. Trade protection measures may help the sector, but prices are expected to increase with rising import prices and labour costs.

Friday, 2 May 2025

– Eurozone Inflation: Consensus sees the headline two-tenths lower at 2.0% and the core one-tenth higher at 2.5%. Tariffs on the eurozone were initially 20% but have been cut to 10% for 90 days. The ECB are worried about their disinflationary impact.

– US Non-Farm Payrolls: Consensus sees 130k jobs added, down from the prior 228k. The unemployment rate is predicted to remain at 4.2%. Wage growth is seen steady at 0.3% m/m. Soft data like business surveys point to downside risks in the labour market.

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