The economic calendar on the last business day of July is quite packed with important fundamental events.
The first major report of the day was the GDP growth rate flash data for Q2 from Germany. Both the monthly and yearly readings were below the forecasts, showing that the economy most likely didn’t grow as much as investors had hoped for.
Italy, another important EU member state, published the same GDP reports as well today, but actually did surprisingly well on both counts.
The eurozone-wide GDP growth rate, both QoQ and YoY, was also much better than the forecasts. Unemployment data was also a pleasant surprise, with the jobless rate in the eurozone falling to 7.7% in June, lower than the forecast.
However, inflation data from the eurozone was a bit mixed. Granted, the YoY flash inflation rate for July was higher than expected at 2.2%, but core inflation was below the forecast at 0.7%.
Later today the United States will publish its own Core PCE report and the PCE price index for June, together with some less important income and wage data.
Investors are also eagerly awaiting the Michigan consumer sentiment report for July, plus two more economic surveys.
As for the stock market, today we expect all major US stock indices to mark losses, in part in anticipation of fundamental data out of the United States, and also in part because of disappointments in the forecasts of some of the biggest tech companies in America.
Amazon disappointed investors yesterday with shrinking growth, as did Apple and Facebook previously.
Meanwhile, the earnings season continues, with Berkshire Hathaway, Exxon Mobil, and Chevron reporting today.
Chinese stocks (including in Hong Kong) are also doing rather poorly today after more regulatory actions by the government, specifically related to companies like Didi Global and Evergrande Group.
