A review of the week past and the week ahead 19th of October

What mattered last week:

The S&P500 finished flat last week. reflecting a tug of war between positive economic data vs rising global coronavirus cases and a stalemate over stimulus talks.
As well as uncertainty ahead of the U.S. election and a still to be resolved Brexit deal.
Locally, the RBA delivered a significant dovish shift to its forward guidance, moving towards an inflation-targeting framework, similar to the Feds.
While China upped the ante in its diplomatic spat with Australia by verbally instructing imports of Australian coal and cotton to be halted.
In New Zealand, Prime Minister Jacinda Arden won re-election in a landslide result.
Volatility, as measured by the VIX index, closed higher at 27.4.
U.S. 10-year yields closed firmer near 0.75%.
Gold gave back last week’s gains closing -1.62% lower, near $1900.
Crude oil closed flat near $41.12/bbl.
The ASX200 built on prior week gains closing another 1.22% higher at 6176.8
In FX, the AUDUSD closed lower near .7080, impacted by policy changes in China and the dovish tones of the RBA.

For the week ahead, the key events are:

Australia: RBA meeting minutes (Tuesday).

RBA meeting minutes (Tuesday): The minutes are expected to be dovish however they are now largely outdated following RBA Governor Lowe’s ultra-dovish speech last week.

New Zealand: NZIER business confidence and global dairy auction (Tuesday), CPI, and balance of trade (Friday).

China: Q3 GDP, employment, fixed asset investment, industrial production, retail sales (Monday).

Q3 GDP (Monday): September quarter GDP is expected to rise by 3.2% qoq after an 11.5% qoq rise in the June quarter. This would take annual growth to 5.3% yoy.

Japan: Balance of trade (Monday), CPI, and Jibun manufacturing PMI (Friday).

U.S: Housing starts, housing permits (Tuesday), jobless claims, existing home sales, (Thursday), Markit composite flash PMI (Friday).

Canada: BoC business outlook survey (Monday), CPI, and retail sales (Wednesday).

Euro Area: German GFK consumer confidence (Thursday), German and EA Markit flash PMI’s (Friday).

EA Markit Composite Flash PMI’s (Friday): As a result of the rise in new coronavirus cases and a tightening of restrictions, a slight fall is expected from last month's 50.4 print.

UK: CPI (Wednesday), GFK consumer confidence, retail sales, and Markit Flash PMI’s (Friday).

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