Investors continue to focus on Italy’s referendum

On Friday, markets closed with the UK’s second reading of Q3 GDP showing true to the first reading and remain at 0.5% bolstering the growth now being seen in the economy so far after the Brexit vote. Business investment also on the quarter showed a rise of 0.9%, again proving confidence in the UK, despite the uncertainty still surrounding the outcome of the forthcoming Article 50 to be triggered early next year.  

Monday 

The run into the Italian’s constitutional reform vote which is to be decided on December 4th is no doubt going to be on investors mind. Prime Minister, Matteo Renzi needs a ‘yes’ vote to win in hope of being able to solve Italy’s banking problems, as up to eight banks are at risk of failing if a ‘no’ vote wins. Matteo Renzi has also put his career on the line by stating if a ‘no’ vote is passed for reforms then he would step down as the Italian Prime Minister, which could then trigger an election for Italy next year. With no polls being allowed to be released on the potential of a yes/no vote the outcome on Sunday could see volatility for the single currency as the results are released.

Tuesday 

Tuesday will focus on the US as the second reading of their Q3 GDP will be released, with growth anticipated to show a slight increase from the first posting of 2.9%. If the 3% increase is posted as expected, this will no doubt prove that further rates will be increased in December by the Fed. Consumer confidence is due to be released later in the afternoon and is expected to also signify confidence rising again. Germany’s monthly inflation figure will be posted in the morning but will be overshadowed by the higher tier US data being released.

  • German Prelim MoM CPI
  • US Prelim Q3 GDP
  • US CB Consumer Confidence

Wednesday

 The Eurozone CPI yearly figure will come into focus in the morning, with Consumer Price expected to show a rise of 0.6% from 0.5%. This would come as a welcome relief for the ECB if another rise in prices is seen, as it would take the pressure off them having to possibly add further measures to help push it towards the target 2% goal. Shortly following this the head of the ECB Mario Draghi, is set to speak in Madrid about the future of Europe. As always his comments will be watched by markets for any clues into any further monetary policy changes he may state. Across the pond from the US the private reading of the Non-farm employment figure is set for release, and as a precursor to Fridays employment figure the markets will watch for an insight into what the Fridays figure may be. 

  • UK BoE Financial Stability Report
  • Euro CPI yoy
  • ECB President Draghi Speaks
  • US ADP Non-Farm Employment Change
  • OPEC meetings

Thursday 

The manufacturing PMI’s will be released throughout the day across the globe starting with China in the morning with an expected figure of 51.0. The Eurozone overall PMI will be posted after the French and German manufacturing gauges are released, all anticipated to remain above the 50 mark and remain in expansion territory. The main gauge of the whole Eurozone for manufacturing is forecasted to remain constant at 53.7. The UK is then set to post its PMI at 54.4, followed by the US which is due to hit 52.1.

  • China Manufacturing PMI
  • Eurozone Manufacturing PMI
  • UK Manufacturing PMI
  • US Manufacturing PMI

Friday

The first Friday of the month will start with the US labour data. The release of the important Non-Farm employment figure will again be looked into for more evidence to see if the Fed will pull the trigger during Decembers meeting. Unemployment is expected to remain at 4.9%, but average earnings on the month is likely to show a decrease to 0.2%, from 0.4%.  Construction PMI from the UK will be posted in the morning and is forecasted to remain in expansion territory.

  • UK Construction PMI
  • US Non-Farm Employment Change
  • US Unemployment Rate
  • US Average earnings MoM