UK prime minister Boris Johnson is expected to renew his push for snap elections in what should be another wild week in Brexit deliberations.
Investors will also be watching the latest in central bank rate calls and US economic data, while Apple will attempt to wow Wall Street and customers alike with the debut of new iPhones. Here’s what to watch.
Brexit
Mr Johnson lost two key votes in early September that further clouded the path toward Brexit. MPs backed a bill aimed at blocking the UK from leaving the European Union on October 31 without a divorce agreement, leading Mr Johnson to call for an election. But a vote to schedule a general election in October failed to garner the required two-thirds support, with opponents seeking to first lock in the law that would have the Conservative government request a Brexit delay.
Mr Johnson, who has sought an election in hopes of breaking the political deadlock, has said he would “rather be dead in a ditch” than seek another delay. Opposition lawmakers said Friday they would not back an election until the government asks the EU for an extension.
That leads us to the coming week, when Mr Johnson plans to make a second bid on Monday to trigger snap elections before the October 31 deadline.
Meanwhile, parliament is on track to be suspended for five weeks ahead of a Queen’s Speech on October 14. The move by Mr Johnson to prorogue parliament is the subject of legal challenges.
ECB rate decision
The European Central Bank will conclude its policy meeting on September 12, and officials are widely expected to cut interest rates and lay out plans for economic stimulus measures.
In July, the ECB left its benchmark rates unchanged, but president Mario Draghi hinted officials could revive a quantitative easing program to boost a slowing economy.
“A rate cut seems to be a done deal, the big question is whether renewed QE will be part of the package”, economists at ING wrote, adding that markets “have come down on the side of the doves on this one and disappointment is therefore a possibility come Thursday.”
Mr Draghi will speak at a press conference following the ECB’s meeting, which comes one week before a rate decision by the US Federal Reserve. The market also expects the Fed to lower rates.
US consumer data
Fresh data on retail sales and prices will offer investors another look at the health of the American consumer and US economy.
The reports — the consumer price index on September 12 and retail sales a day later — will also factor into the Fed’s assessment of economic trends ahead of its policy meeting.
Consumer spending has been a bright spot in the US. Big retailers including Walmart and Lowe’s posted robust sales last quarter. US retail sales grew a solid 0.7 per cent in July amid steady wage and employment growth, better than the prior month’s 0.3 per cent advance and the strongest gain in four months. Economists polled by Thomson Reuters forecast that August retail sales increased 0.2 per cent.
CPI data are expected to show a 0.1 per cent increase, compared with a rise of 0.3 per cent a month ago.
“We think that consumer and producer price inflation were little changed in August, with the tariffs on Chinese goods still yet to have any significant impact. Otherwise, we anticipate only a small rise in retail sales, but consumption growth is still likely to be fairly strong in Q3 as a whole,” said Andrew Hunter, senior US economist at Capital Economics.
Also next week, the University of Michigan will release its initial reading on consumer sentiment in September. Market volatility and concerns over the US-China trade spat dragged down sentiment in August.
Apple iPhone launch
Apple will hold its closely watched fall product event on September 10.
The main event will be the unveil of the tech giant’s next generation of iPhones, its flagship device that accounted for nearly half of net sales in the most recent quarter. Apple is expected to introduce upgrades for its current high-end iPhones, the XS and XS Max, and a new version of its lower-priced smartphone.
Apple’s services — a fast-growing segment for the company that includes iTunes and the App Store — will also be in the spotlight.
CFRA analyst Angelo Zino expects Apple to announce pricing and a launch date for Apple TV+, the company’s upcoming streaming service. The company has invested heavily in the project, signing up Oprah Winfrey, Steven Spielberg and Jennifer Aniston, among others, to create original shows and movies.
