As the mid-summer sun rises and as most traders take advantage of the current newsflow lull to step away for a quick vacation, the FOMC minutes from the July 29 meeting should be one of the more interesting events in this quiet week especially if there are signs of a potential average inflation target being discussed – with the other being the various surveys ending with the flash August PMIs on Friday. As DB’s Craig Nicol notes, this should give investors one of the first indications of how the global economy has fared moving into the month, so it’ll be interesting to see if the recent positive momentum in most of the PMIs is sustained. For reference in the July PMIs, with the exception of Japan, all of the other countries (Australia, France, Germany, Euro Area, UK and US) had PMIs above the 50-mark that separates expansion from contraction.

We’ll see if that helps the S&P 500 complete the final half a percent or so needed to take it to new all-time highs. The other talking point has the bear-steepening in rates which for Treasuries saw 2s10s jump to 56bps, steepening 13bps on the week. For what it’s worth, DB’s strategist think there could be more to come and target 0.85% on the 10y Treasury (about 15bps above this morning’s level).

Investors are also bracing for election season to kick into higher gear with the Democratic National Convention, which runs Monday through Thursday. The Republican convention will be held from Aug. 24 to Aug. 27 and both will be mostly virtual this year due to the COVID-19 pandemic.

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Elsewhere, earnings season is almost done, and as of Friday, 457 companies in the S&P 500 have reported results, of which 81.4% came in above dramatically lowered expectations, according to Refinitiv data. The retailers, along with Walmart, Kohls and Target are due to report second-quarter earnings later in the week.

Below is a day-by-day calendar of events, courtesy of Deutsche Bank:


  • Data: Japan preliminary Q2 GDP, US August Empire State manufacturing survey, August NAHB housing market index, June foreign net transactions
  • Central Banks: Fed’s Bostic speaks Earnings: BHP Group,
  • Politics: Democratic Convention begins


  • Data: US July building permits, housing starts
  • Central Banks: RBA release meeting minutes
  • Earnings: Walmart, Home Depot, Lowe’s, Target, TJX
  • Politics: Latest round of UK-EU negotiations on their future relationship commences


  • Data: Japan July trade balance, June core machine orders, UK July CPI, Euro Area June current account, final July CPI, Canada July CPI
  • Central Banks: Bank Indonesia policy decision, FOMC release meeting minutes
  • Earnings: Nvidia


  • Data: Germany July PPI, US August Philadelphia Fed business outlook, weekly initial jobless claims, July leading index Central
  • Banks: Central Bank of Turkey policy decision, ECB and RBI release meeting minutes, Fed’s Daly speaks
  • Earnings: Alibaba, Estee Lauder
  • Politics: Democratic presidential candidate Joe Biden speaks at the Democratic convention


  • Data: August Manufacturing, services and composite PMIs for Australia, Japan, France, Germany, Euro Area, UK and US, Japan July nationwide CPI, UK July retail sales, Canada June retail sales, Euro Area August advance consumer confidence, US July existing home sales
  • Earnings: Deere & Company
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* * *

Finally, looking at just the US, Goldman notes that the key economic data release this week is the Philadelphia Fed manufacturing index on Thursday. In addition, minutes from the July FOMC meeting will be released on Wednesday.

Monday, August 17

  • 08:30 AM Empire State manufacturing index, August (consensus +15.0, last +17.2)
  • 10:00 AM NAHB housing market index, August (consensus 74, last 72)
  • 12:00 PM Atlanta Fed President Bostic (FOMC non-voter) speaks: Atlanta Fed President Raphael Bostic will discuss inclusive innovation in a virtual event hosted by the Rotary Club of Atlanta. Audience Q&A is expected.

Tuesday, August 18

  • 08:30 AM Housing starts, July (GS +3.8%, consensus +4.6%, last +17.3%); Building permits, July (consensus +4.9%, last +3.5%): We estimate housing starts rose +3.8% in July. Our forecast incorporates a boost from lower mortgage rates and stronger construction job growth.

Wednesday, August 19

  • 02:00 PM Minutes from the July 28-29 FOMC meeting: At its July meeting, the FOMC left the target range for the policy rate unchanged at 0-0.25%, as widely expected, and made no changes to its forward guidance. In the minutes, we will look for further discussion on the framework review, forward guidance, and asset purchase policies.

Thursday, August 20

  • 08:30 AM Philadelphia Fed manufacturing index, August (GS 24.1, consensus 21.0, last 24.1): We estimate that the Philadelphia Fed manufacturing index remained unchanged at 24.1 in August.
  • 08:30 AM Initial jobless claims, week ended August 15 (GS 975k, consensus 920k, last 963k); Continuing jobless claims, week ended August 8 (consensus 15,000k, last 15,486k): We estimate initial jobless claims ticked up to 975k in the week ended August 15.
  • 01:00 PM San Francisco Fed President Daly (FOMC non-voter) speaks: San Francisco Fed President Mary Daly will discuss the new future of work at an event hosted by the San Francisco Fed.
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Friday, August 21

  • 09:45 AM Markit Flash US manufacturing PMI, August preliminary (consensus 51.5, last 50.9)
  • 09:45 AM Markit Flash US services PMI, August preliminary (consensus 50.9, last 50.0)
  • 10:00 AM Existing home sales, July (GS +18.0%, consensus +14.4%, last +20.7%): After rebounding by 20.7% in June, we estimate that existing home sales increased 18.0% further in July. Existing home sales are an input into the brokers’ commissions component of residential investment in the GDP report.

Source: DB, GS, BofA

Via Zerohedge