Week ahead: Tesla tops Wall Street earnings bill

Here are the week’s key events:

Earnings season continues over on Wall Street with several Dow components reporting, though the highlight for stocks traders will undoubtedly be Tesla’s third quarter update following a disappointing guide on deliveries for the period. Meanwhile attention for the broader market rests on the ongoing situation in Israel.

Monday

Markets will reopen to fresh news from Israel and Gaza – whatever that may be. The atrocities carried out by Hamas last weekend produced a sharp spike in oil prices so watch for signs of any broadening in the conflict affecting energy markets. On the data front, UK house prices from Rightmove, the US Empire State manufacturing index and New Zealand’s CPI inflation reading are among the highlights on a fairly quiet day.

Tuesday

Bank earnings continue on Wall Street with Bank of America and Goldman Sachs. RBA monetary policy meetings will be parsed for signs of further hikes and UK unemployment claims data kick off a busy week for Bank of England watchers. US retail sales figures will offer a glimpse on the health of the consumer, which is so far proving far more resilient than first assumed. American consumers spent more than expected in August, with retail sales up 0.6%, but this was mainly down to higher gasoline costs and the underlying spending on goods slowed.

Earnings: Bank of America (BAC), Goldman Sachs (GS), Johnson & Johnson (JNJ)

Wednesday

Tesla earnings will get the most attention. Shares have surged this year despite price cuts and declining sales growth. Deliveries hit 435,059 in the third quarter, up 27 on last year. But this was down 31k from the second quarter and fell short of Wall Street reduced expectations. Tesla said the sequential decline in volumes was caused by planned downtimes for factory upgrades and it stuck to its 2023 volume target of around 1.8 million vehicles. The key question is about margins – a series of price cuts this year has buttressed shares but seen industry-leading profit margins decline eight percentage points to 18.2% in the second quarter.

Earnings: Morgan Stanley (MS), Procter & Gamble (PG), Netflix (NFLX), Tesla (TSLA)

Thursday

Australia employment data and the RBNZ Statement of Intent set the tone in the Asian session before a clutch of key US data – weekly unemployment claims, the more sensitive barometer of labour market health which has been holding up remarkably well despite multiple rate hikes. Also on the tape is the Philly Fed manufacturing index and existing homes sales data in light of mortgage rates hitting their highest in 23 years.

Earnings: AT&T (T), Taiwan Semiconductor Manufacturing (TSM)

Friday

With the Bank of Japan unclear about exactly when and how it will exit negative rates and yield curve control, watch the latest national core CPI print – last at 3.1%. China could make an adjustment to its one-year and five-year loan prime rates. Retail sales data rounds out the week for the UK and German PPI figures are also due.

Earnings: American Express (AXP), SLB (SLB)