Whimper before the bang

Share markets are off to a modest start this week ahead of a packed economic calendar over the rest of the week. Despite surging European shares, a mid-session sentiment reversal in the US on Friday night could see enthusiasm wane over the trading day.

Share markets are off to a modest start this week ahead of a packed economic calendar over the rest of the week. Despite surging European shares, a mid-session sentiment reversal in the US on Friday night could see enthusiasm wane over the trading day. Gains for oil may see energy stocks in the spotlight, but falling metals prices mean commodity influences are a mixed bag.

Investor attention will turn to the macro this week. Building approvals and retail sales both have potential to move the local bourse. However, the big news will flow from China and the USA. Concerns about economic growth in China make this Thursday’s official and private PMIs crucial. The manufacturing and non-manufacturing data will drop side by side, offering a snapshot of where China stands right now. On Friday US non-farm payrolls will speak directly to the potential for an October rate rise, and cap a week where inflation, housing, manufacturing, mortgage and ISM data is released.

The busy week ahead may dull investor appetites today. Futures are pointing to a small fall at the open, but stronger than expected US GDP and interest in oil and gas shares could see the boards turn green. The Australian 200 index has traded sideways for five weeks. This week may provide the catalyst for a break out from the current narrow range, but today is not the day.

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