Week Ahead: Li visits Europe while Modi flies to Washington

Hello and welcome to the working week.

A key theme in the coming days will be global diplomacy.

Chinese premier Li Qiang will arrive in Germany for his first overseas trip since his appointment. The tour will also include France. Meanwhile, Narendra Modi visits Joe Biden at the White House. The Indian prime minister will become one of a few foreign leaders, along with Winston Churchill, Nelson Mandela and Volodymyr Zelenskyy, to address a joint session of Congress more than once.

Key interest rate decisions are expected in Beijing, Ankara and London. The People’s Bank of China last week announced a surprise cut in its main policy rate; on Tuesday it is scheduled to publish its latest move. The Bank of England’s monetary policy committee is expected to increase the UK base rate further from 4.5 per cent; markets are betting that rates will peak close to 5.75 per cent this year.

And the recent shift in economic policy by Turkish president Recep Tayyip Erdoğan will face its first test as new central bank governor Hafize Gaye Erkan chairs her debut policy meeting. Business executives and analysts expect Turkey’s main interest rate to rise sharply to 17 per cent, from 8.5 per cent.

Investors will be watching for indications of the future path of US rates as Federal Reserve chair Jay Powell testifies at the Senate Banking Committee.

Other events this week include the Paris Air Show, which returns after a four-year hiatus. Delegates from G7 nations and international financial institutions will meet in London for a conference to discuss the reconstruction of Ukraine. In the UK, MPs will gather on Monday to ratify a damning parliamentary report on Boris Johnson, the former prime minister.

The week ends with Greeks going to the polls a second time in just over a month, after Kyriakos Mitsotakis’s New Democracy party failed to secure an outright majority at the last ballot.

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Economic data

There will be a chance to compare G7 nations at the end of the week with the release of flash manufacturing and services purchasing managers’ indices, plus a few confidence surveys, some housing market indicators for the US and the UK and monthly inflation data from Japan and Germany.

Companies

Has anyone at Activision Blizzard considered producing a computer game based on battling courtroom lawyers? They certainly have the material given the regulatory challenges its merger with Microsoft have come up against. The contest will go to the next level this week when a district court in California holds an “evidentiary hearing” on Federal Trade Commission plans to block the transaction.

It’s thin gruel as far as earnings are concerned, but Accenture could be interesting given the consultancy sector’s travails. Also, British asset manager Liontrust is expected to post higher annual profits, driven by strong fee revenues and outflows. Further details below.

Economic and company reports

Here is a more complete list of what to expect in terms of company reports and economic data this week.

Monday

• UK, Rightmove’s June House Price Index

• US, Juneteenth federal holiday. Financial markets closed.

Tuesday

• China, Mainland China Policy rate

• IMD World Competitiveness Center launches its annual World Competitiveness Ranking of countries.

• European Central Bank board member Philip Lane discusses “The dynamics of the financial system in the Eurozone” at the Bernacer Prize ceremony in Madrid.

• The world’s biggest producers of lithium for electric vehicle batteries hold their largest annual gathering at the Fastmarkets Lithium Supply & Battery Raw Materials conference in Las Vegas.

• Germany, May producer price index (PPI) inflation rate figures

• UK, Kantar grocery market share figures

• US, May housing starts and building permits

• Results: FedEx Q4

Wednesday

• Case management hearing in the class action case brought by British consumer champion Liz Coll against Alphabet and its subsidiary Google. Coll, who is representing 19.5mn Android phone users, claims the 30 per cent surcharge added to products bought through the Google Play store is a breach of European and UK competition laws and seeks damages of almost £1bn.

• Numis general meeting of shareholders to vote on the proposed acquisition of the company by Deutsche Bank.

• Novo Nordisk chief executive Lars Fruergaard Jørgensen and Bayer’s pharma chief Stefan Oelrich to speak at an industry event in Brussels hosted by big pharma lobby group EFPIA.

• Canada, retail sales figures

• Germany, Ifo economic forecast

• South Africa, May consumer price index (CPI) inflation rate figures

• UK, May CPI, retail price index (RPI), PPI and harmonised index of consumer prices (HICP) inflation rate figures. Also, May public sector finances data.

• Results: Berkeley Group FY, Liontrust Asset Management FY

Thursday

• US district court in San Francisco begins hearing evidence in Federal Trade Commission suit requesting injunction in Microsoft and Activision Blizzard merger

• US, Federal Reserve Chair Jay Powell testifies at US Senate Banking Committee

• Netflix co-chief executive Ted Sarandos visits Seoul to speak about the media streaming company’s $2.5bn investment in South Korean entertainment

• EU, June flash consumer confidence Indicator

• Turkey, one-week repo rate decision

• UK, Bank of England monetary policy committee rate decision

• Results: Accenture Q3, DS Smith FY, Mulberry FY, Speedy Hire FY, Whitbread Q1 trading update

Friday

• EU, France, Germany, Italy, Japan, UK, US: S&P Global/Cips flash services and manufacturing purchasing managers’ index (PMI) figures

• Germany, Ifo business climate survey

• Japan, May CPI inflation rate data

• UK, June GfK consumer confidence report and May retail sales figures

• Results: CarMax Q1, Naked Wines FY, Zephyr Energy FY

World events

Finally, here is a rundown of other events and milestones this week.

Monday

• France, 54th International Paris Air Show begins, running until Sunday

• Germany, Nato secretary-general Jens Stoltenberg begins a two-day visit with a meeting in Berlin with chancellor Olaf Scholz

• US, President Joe Biden speaks at a campaign fundraiser in California

• Republican presidential candidate and Florida governor Ron DeSantis will visit the same state today for his fundraising campaign

• UK, MPs vote on approving a privileges committee report which concluded that former prime minister Boris Johnson misled parliament over rule-breaking parties at his office during Covid lockdowns

Tuesday

• 60th anniversary of agreement to create the Kremlin-White House hotline to avert a nuclear war starting accidentally

• Chinese premier Li Qiang and various members of his cabinet arrive in Berlin for bilateral government consultations, the first face-to-face summit between the two countries since 2018. The delegation will then travel to Paris for an official visit and to attend a financial conference on Thursday

• UK, chancellor Jeremy Hunt answers questions by MPs on the Treasury select committee in the House of Commons

• UK, Royal Ascot horse race meeting begins

Wednesday

• Summer solstice, marking the longest day of the year and the first day of summer in the northern hemisphere

• UK, London hosts a two-day Ukraine Recovery Conference

Thursday

• Qatar, municipal elections

• UK, chief medical officer for England Chris Whitty and Britain’s former chief scientific adviser Patrick Vallance give evidence to the UK’s Covid-19 Inquiry

• UK, Women’s Ashes cricket series begins with a Test match at Nottingham’s Trent Bridge ground

• US, president Joe Biden hosts Indian prime minister Narendra Modi for an official state visit to Washington

Friday

Saturday

• Sierra Leone, presidential and parliamentary elections

• UK, Scottish National party convention in Dundee to debate how to hold a second legally binding independence referendum

Sunday