Week Ahead: US30 Braces for Retail Reckoning
14th August
Key takeaways
US30 up ~12% YTD, sitting within 2% of its all-time high.
Retail on trial: Home Depot (Aug 18) and Walmart (Aug 20) test consumer health.
Watch 53,650: hold it for 54,800, lose it for 52,500.
Lukman Otunuga
Head of Market Research
A cocktail of high-risk events could serve up fresh trading opportunities in the week ahead.
From the Fed meeting minutes to earnings from retail giant Walmart and another round of PMI data across the globe.
Monday, 17th August
- CAD: Canada CPI
- CNY: China retail sales, industrial production, fixed assets investment
- JPY: Japan GDP, industrial production, tertiary industry index
Tuesday, 18th August
- AUD: Australia Westpac consumer confidence
- EUR: Germany ZEW survey expectations
- GBP: UK unemployment, average weekly earnings
- USD: US housing starts, industrial production
- US30: Home Depot earnings
Wednesday, 19th August
- EUR: Eurozone CPI
- GBP: UK CPI, house price index
- US30: US FOMC meeting minutes, mortgage applications
Thursday, 20th August
- AUD: Australia unemployment
- CNY: China loan prime rates
- USD: US jobless claims, Philadelphia Fed business outlook
- CHINAH: Alibaba earnings
- US30: Walmart earnings
Friday, 21st August
- CAD: Canada retail sales
- EUR: Eurozone S&P Global manufacturing PMI, consumer confidence, ECB CPI expectations
- JPY: Japan CPI, S&P Global manufacturing PMI
- GBP: UK budget, retail sales, S&P Global manufacturing PMI
- USD: US S&P Global manufacturing PMI
The spotlight shines on FXTM’s US30, which is up roughly 12% year-to-date, trading within 2% of its all-time high.
Here are 3 forces that may influence the index:
1) US retail behemoths:
Two of America's retail giants report their earnings, offering a direct read on the health of consumer spending. Given how Home Depot & Walmart account for roughly 5% of the US30 weight, their results could trigger volatility. Beyond earnings, keep an eye on FOMC minutes and PMI data which both may impact the US30.
2) Geopolitical risk:
Iran and Oman have agreed on shipping-route coordinates through the Strait of Hormuz, and diplomatic chatter suggests a broader arrangement may be close. However, a full re-opening remains unresolved, with renewed tensions keeping oil prices elevated. The US30 could take a hit if this rekindles Fed hike bets. Traders are currently pricing a 30% chance of a rate increase by September.
3) Technical forces:
The US30 is respecting an upward channel on the daily charts with a bullish flag formation in play since the early parts of August. Key technical levels can be found at 54800, 53650 and the 50-day SMA.
Frequently asked questions
Home Depot and Walmart are ~3.8% and ~1.3% of the Dow and a direct read on US spending.
Iran struck UAE tankers twice in a week. "Close to a deal" isn't "over."
FOMC minutes Wednesday, global PMIs Thursday - both carry real weight.