Brexit remains top of the agenda this week as the Supreme Court is set to deliver its verdict on how the government can trigger Article 50, while it’s a busy week for earnings on both sides of the Atlantic as the likes of Amazon and Alphabet report alongside some important UK blue chips. Fourth quarter GDP numbers for the US and UK will also be closely watched.

Supreme Court

 

After Theresa May’s Brexit speech soothed the markets, there is potential for further volatility in the pound on Tuesday as the Supreme Court is set to deliver its final verdict on whether the government needs parliamentary approval to trigger Article 50.

A panel of 11 justices sitting on Britain’s highest legal authority will determine whether the prime minister can officially commence the process of leaving the European Union without MPs getting a vote. Labour intends to vote with the government so there is not much chance of the House of Commons turning the tables on the referendum result.

However, a win for the government could free its hand considerably. A loss could significantly slow down and complicate the exit process. Legislatures in Scotland, Wales and Northern Ireland will also be looking for any judgment on their respective roles in the process.

The ruling could have a significant effect on sterling and volatility of pound crosses like GBPUSD and EURGBP could be high around this announcement, which is expected at 09:30 (GMT) on Tuesday, January 24th.

Fourth quarter GDP readings

 

Back to the macro data and we get the first read of fourth quarter GDP growth for both the UK and US this week. Surging PMI readings and consumer spending could mean another solid quarter for Britain’s economy despite the uncertainty of Brexit. The US number will of course take on added significance as markets start to price in a series of interest rate rises in 2017.

USD and Treasury bond volatility could rise around the US release on Friday, while there could be some choppy trading in gilts and GBP when the UK numbers are reported the day before.

US tech giants’ earnings

 

Following the lead of the big banks, US tech companies are expected to report yet more stellar quarterly earnings figures this week.

Super Thursday sees Amazon, Alphabet and Microsoft deliver their latest revenue and profit figures. Yahoo! and Verizon, which are about to jump into bed together in one of the most talked-about M&A deals of the last decade, both report their Q4 numbers.

All-American Dow Jones industrial average stalwarts Ford, Chevron and Caterpillar are among the other large cap US companies set to report in what is about the busiest week for earnings on Wall Street.

Wall Street and the S&P 500 are the markets to watch around these releases.

UK blue chips report

 

Finally, some big players on the FTSE 100 are due to report this week, making for some potential volatility in early trading on the UK 100. Diageo, BT and Sky are among the blue chip stocks to update the market.

Economic Calendar

(All times GMT)

Monday, 23 January

04:30 – Japan all industries activity report

15:00 – Eurozone consumer confidence

Tuesday, 24 January

Tentative – Brexit Supreme Court ruling (expected around 09:30)

00:30 – Japan flash manufacturing PMI

08:00 – French flash manufacturing & services PMIs

08:30 – German flash manufacturing & services PMIs

09:00 – Eurozone flash manufacturing & services PMIs

09:30 – UK public sector net borrowing

14:45 – US flash manufacturing PMI

15:00 – US existing home sales, Richmond Fed manufacturing index

23:50 – Japan trade balance, imports, exports

Wednesday, 25 January

00:30 – Australia CPI inflation

07:00 – UK Nationwide house price index

09:00 – German Ifo business climate

15:30 – US crude oil inventories

21:45 – New Zealand CPI inflation

Thursday, 26 January

07:00 – Spanish unemployment rate

07:00 – German GfK consumer climate

09:30 – UK preliminary 4th quarter GDP reading

13:30 – US weekly unemployment claims

15:00 – US new home sales

23:30 – Japan core CPI, Tokyo core CPI

Friday, 27 January

06:30 – French preliminary GDP reading

07:00 – Spanish flash GDP reading

07:45 – French consumer spending, preliminary CPI inflation

13:30 – US advanced fourth quarter GDP reading, core durable goods orders

 

Earnings Calendar

 

Monday, 23 January

Halliburton (HAL) – Q4/2016, EPS estimate 0.018

McDonald’s (MCD) – Q4/2016, EPS estimate 1.414

Yahoo! (YHOO) – Q4/2016, EPS estimate 0.210

Tuesday, 24 January

3M (MMM) – Q4/2016, EPS estimate 1.871

Alcoa (AA) – Q4/2016, EPS estimate 0.180

Johnson & Johnson (JNJ) – Q4/2016, EPS estimate 1.562

Kimberly-Clark (KMB) – Q4/2016, EPS estimate 1.415

Lockheed Martin (LMT) – Q4/2016, EPS estimate 3.048

Travelers (TRV) – Q4/2016, EPS estimate 2.777

Verizon Communications (VZ) – Q4/2016, EPS estimate 0.894

SAP SE (SAP) – Y/2016, EPS estimate 3.796

Dixons Carphone (DC) – Christmas trading update

Wednesday, 25 January

AT&T (T) – Q4/2016, EPS estimate 0.658

Boeing (BA) - Q4/2016, EPS estimate 2.338

eBay (EBAY) – Q4/2016, EPS estimate 0.536

United Technologies (UTX) – Q4/2016, EPS estimate 1.570

Thursday, 26 January

Alphabet (GOOGL) – Q4/2016, EPS estimate 9.647

Amazon.com (AMZN) – Q4/2016, 1.370

Biogen (BIIB) – Q4/2016, EPS estimate 4.967

Caterpillar (CAT) – Q4/2016, EPS estimate 0.660

Celgene (CELG) – Q4/2016, 1.592

Ford (F) – Q4/2016, EPS estimate 0.332

Intel Corp (INTC) – Q4/2016, EPS estimate 0.746

Microsoft (MSFT) – Q2/2017, EPS estimate 0.789

Northrop Grumman (NOC) – Q4/2016, EPS estimate 2.489

Raytheon (RTN) – Q4/2016, EPS estimate 1.852

Starbucks (SBUX) – Q1/2017, EPS estimate 0.520

Diageo (DGE) – S1/2017, EPS estimate 0.601

Sky (SKY) – S1/2017

Unilever (ULVR) – Y/2016

Friday, 27 January

American Airlines (AAL) – Q4/2016, EPS estimate 0.909

Chevron (CVX) – Q4/2016, EPS estimate 0.650

Honeywell International (HON) – Q4/2016, EPS estimate 1.739

BT Group (BT/A) – Q3/2017, EPS estimate 0.080

Source: Bloomberg

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