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Market focus: Inflation updates, retailer performances, and economic data

A meandering week ahead for markets, featuring some inflation news in the US and Australia, a GDP update for America, building approvals in Australia, China’s latest economic activity surveys, and a final rush of meetings and earnings releases both locally and offshore.

Markets and analysts will be closely monitoring Black Friday and Cyber Monday sales performances from retailers.

Japanese retailer Fast Retailing, along with its Uniqlo brand, will provide the most up-to-date view of global retailing’s performance heading into the end of 2023 in its upcoming update on Friday.

Additionally, this week will bring the usual start-of-month activity surveys from China, Australia, Asia, Europe, the UK, and the US, expected to show a slight improvement compared to November’s mixed readings.

On Wednesday, Australia will release the monthly inflation indicator for October, with a forecasted decrease to 5.2% from 5.6% in September. However, this might not fully reflect the drop in oil and petrol prices during the month, as the indicator only covers just over 70% of the quarterly CPI each month.

Furthermore, retail sales for October are expected to rise by 0.2%, slowing down from the surprising 0.9% increase in September. Building approvals for October are also anticipated to be released on Thursday, with a forecasted nearly 13% month-on-month decline.

This week will witness the release of the first data for the September quarter’s national accounts, including the value of construction work done for the quarter and private investment data. A small rise in construction is expected, while a slowdown in capex is predicted, both compared to the June quarter.

Markets will be closely monitoring the oil market and the OPEC+ meeting on Thursday, along with the release of the US data on oil stocks, production, and rig use later in the week.

Australia will see a couple of annual results, including Fisher & Paykel Healthcare and Collins Foods.

This week also marks the end of the June 30 annual meeting season. Retailer Harvey Norman shareholders will meet on Thursday, and several lithium companies, including Liontown and Azure, stand out with their meetings. Mid-cap miners Lynas and Sandfire Resources will also hold their meetings, along with industrial companies like Ramsay Healthcare, Healius, and Alliance Aviation Services.

RBA Governor Michelle Bullock will participate in a Hong Kong Monetary Authority seminar later today.

In the US and Europe, inflation takes center stage this week. The Fed’s favored Personal Consumption Expenditure data for October will be released on Thursday, with a focus on core PCE inflation, which is expected to be at an annual rate of 3.5%, down from 3.7%.

Several Fed members will make public appearances this week, with the most significant being Fed Chair Jay Powell’s speech on Friday at a US college function in Atlanta, following the release of the latest PCE figures and GDP numbers.

The second estimate of US September quarter GDP will also be issued on Wednesday, with forecasts indicating a small increase to 5% from 4.9% in the first estimate. Other data to watch includes house price and new home sales figures, consumer confidence updates, and the first business activity survey for November.

Several companies will report their results, including and Ulta Beauty on Thursday, as well as Intuit, Footlocker, Kroger, and Hormel Foods.

The big Canadian banks, including CIBC, Bank of Nova Scotia, Royal Bank of Canada, Bank of Montreal, and Toronto-Dominion, are also scheduled to report this week.

Europe will see flash figures on inflation, which are expected to decrease slightly, and unemployment, which is anticipated to rise slightly.

However, the most closely watched result will come from Japan’s Fast Retailing, which owns the Uniqlo chain, competing with Zara and H&M in the affordable and stylish fashion wear sector. This report for the first quarter, spanning from September to November, will provide the most up-to-date insights into global retailing and is due on November 30.

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