Stocks to Edge Lower Before Earnings Flurry, Fed: Markets Wrap

Stocks in Asia were set for a small drop ahead of a week packed with earnings results and a Federal Reserve interest-rate decision.

The dollar remains near a 14-month low and the euro is holding on to recent gains with the greenback near to a technical level that some say will precede more losses. Equity-index futures in Japan, Hong Kong and South Korea were all lower and oil extended declines before an OPEC meeting on Monday.

Earnings season and changes in central bank policy are providing the latest tests for the bull-market in equities that’s propelled the value of global shares to $78 trillion. Results at industry bellwethers from Inc. to GlaxoSmithKline Plc and Credit Suisse Group AG are due this week. The Fed is expected to stand pat, with investors looking to the accompanying statement for clues on how officials plan to start reducing the balance sheet.

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Here are some key events coming up this week:

  • Australia’s inflation probably slowed in the second quarter, possibly below the Reserve Bank of Australia’s target of between 2 percent and 3 percent, forecasts show ahead of the release on Wednesday. 
  • Japanese June data also due this week may show sluggish CPI, even amid a tightening labor market and increased household spending. 
  • China posts industrial profits for last month, with early indicators pointing upward.
  • Fed chief Janet Yellen is in something of a bind: inflation remains muted and the job market robust. As a result, the central bank is expected to make no change to policy on Wednesday with investors and economists parsing the statement for clues on how officials plan to proceed in reducing their massive portfolio.
  • Alphabet Inc., Amazon and Facebook Inc. results are all on the calendar this week, as are global banks Credit Suisse, Deutsche Bank AG, Nomura Holdings Inc., BNP Paribas SA and UBS Group AG. Pharma giants like Merck, Roche, GlaxoSmithKline and Eli Lilly are also due along with McDonald’s, Caterpillar, GM, Ford, Boeing, Royal Dutch Shell, Total and Exxon.

These are the notable moves in markets: 

  • The yen traded at 111.16 per dollar as of 6:52 a.m. in Tokyo. The euro bought $1.1668.
  • WTI crude lost 0.4 percent in early Monday trading to $45.61 a barrel.
  • Futures on the S&P 500 Index were little changed. The underlying gauge closed flat on Thursday and Friday last week.
  • Gold was flat at $1,255.30 an ounce having climbed the past two weeks.
  • The yield on the 10-year Treasury note ended last week at 2.24 percent.

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