Monday 16 September First-half results from Phoenix Group, Wilmington and Keywords Studios and Rightmove UK house price index Tuesday 17 September Full-year results from Ferguson, McBride and Springfield Properties and First-half results from IP Group, Henry Boot, Petershill Partners, Trufin and Good Energy and German ZEW economic survey US retail sales US industrial production and capacity utilisation US NAHB house building industry survey Wednesday 18 September Full-year results from PZ Cussons and MJ Gleeson and First-half results from MC Saatchi and Xaar and Trading statement from Moonpig UK inflation EU inflation US building permits US building starts US oil inventories
* General Mills, a major US food company, is facing challenges in the US market. * The US Federal Reserve is expected to announce its interest rate decision on September 18th. * The Fed is expected to make its first rate cut of the year. * General Mills’ stock price has been declining.
Russ Mould, AJ Bell investment director, Danni Hewson, AJ Bell head of financial analysis and Dan Coatsworth, AJ Bell investment analyst, said: “At first glance, a first cut in the Target Fed Funds rate since March 2020 seems to be in keeping with the core narrative that is doing so much to boost equity and government bond markets alike, namely that inflation will cool, economies will enjoy a soft landing (if indeed there is any landing at all in the US) and that central banks will therefore be able to cut the headline cost of money. “Those rate cuts are in turn expected to stimulate demand for credit and thus economic activity, boost corporate earnings and cash flows thanks to higher demand (and lower interest bills) and persuade investors to take more risk, with asset classes such as equities, as the yield available from cash and fixed-income decline.”
This historical data suggests that the Fed’s actions, particularly its interest rate cuts, can have a positive impact on the stock market. The Fed’s actions are not limited to interest rate cuts. The Fed also engages in open market operations, where it buys and sells government securities to influence the money supply. This strategy, known as quantitative easing, has been used to stimulate the economy during periods of recession.
The Fed has also cut rates by an average of 1.5 percentage points in response to a recession.
The retailer will also be releasing its full-year results on 28 November, with a trading update expected in September. Next will also be providing more details about its strategy for the next year in this year’s Annual Report. Next has been a strong performer in the UK and internationally, exceeding expectations on a number of occasions.
“Next seems to have the knack of getting this right and in this respect its key performance indicator (KPI) of growth in full-price sales is particularly helpful.” Pre-tax profits guidance for the year is now £980m for the year, compared to last year’s result of £908m. Thursday 19 September Full-year results from Close Brothers and Galliford Try First-half results from Judges Scientific and S4Capital and Trading statement from Ocado Bank of England interest rate decision German Ifo economic survey US existing homes sales US weekly initial unemployment claims In the US, quarterly results from FedEx, Lennar and Darden Restaurants Friday 20 September
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