• Retail sales report to conclude UK data marathon

  • Semi-important US labour market data to be released in the afternoon

  • Microsoft (MSFT.US) expected to report over $29 billion revenue

In Thursday’s calendar investors will find just a few important readings. Firstly, the UK retail sales report is scheduled for release in the morning and may give GBP a chance to recover after yesterday’s slump resulting from weak inflation reading. The weekly piece of the US labour market data will be published in the afternoon. Apart from that, we encourage investors to follow the earnings calendar as financial reports releases may greatly increase volatility on particular stocks.

9:30 am BST – UK, Retail sales for June. Inflation report released yesterday missed the expectations heavily causing GBP to free fall.  In turn the outlook and market odds for a rate hike in August have diminished. Today’s retail sales reading may give GBP another chance to pare at least some of recent losses. The headline reading is expected to show deceleration from 3.9% YoY to 3.7% YoY while the core measure should move from 4.4% YoY to 3.5% YoY. Nevertheless, it is worth to note that the demand in the UK economy is strong as in the past five years we have seen only one negative retail sales reading on year-over-year basis.

1:30 pm BST – US, Initial Jobless Claims. Jerome Powell recognized the strength of the US labour market in his speech to the Senate Banking Committee on Tuesday. It is hard to disagree with him taking a look at the latest NFP reports. What is more, for the past few years the number of people filing for the unemployment insurance each week has been constantly falling. Today’s data is expected to show 220k, what would be a minor upside against last week’s 214k. Simultaneously, the Philadelphia Fed manufacturing index will be published and according to the economists survey by Bloomberg it should move from 19.9 pts to 21.5 pts.

Central bank speakers scheduled for today:

  • 2:00 pm BST – Fed’s Quarles

Notable US companies reporting earnings today:

  • Union Pacific (UNP.US)

  • Philip Morris International (PM.US)

  • Microsoft (MSFT.US)

  • Bank of New York Mellon Corp (BK.US)

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GBPUSD slumped following release of the UK inflation report. The pair is struggling near the lower bound of the long term support zone and today’s data stream may be crucial for this market. Source: xStation5