US Dollar Fundamental Outlook: Bearish
Q3 Corporate Earnings
Third-quarter corporate earnings data from technology, industrial, energy and pharmaceutical giants will be closely scrutinized by investors. Some big names include Facebook, Apple, Alphabet, Twitter, Pfizer, Gilead, Chevron, Exxon Mobil, Petrobras, Royal Dutch Shell, Credit Suisse, Visa, Deutsche Bank, GE, Airbus, Boeing, Ford, Caterpillar and many more.
Last week, Tesla significantly overpassed earnings expectations and saw the jumpy stock rise as much as five percent in one day. Military Goliath Lockheed Martin stock fell on soft guidance for 2021 despite also beating earnings. Mixed earnings did not help the S&P 500[2], which ended the week in negative territory as ongoing US fiscal stimulus talks rattles sentiment and undermines risk appetite.
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It is possible this same dynamic may be replayed in the week ahead, potentially setting the equity index up – along with other indices – for another week of losses. The US Dollar may rise at the expense of these growth-anchored benchmarks, though if progress is made on fiscal talks on top of strong earnings data, this dynamic may reverse.
US GDP Data
Flash US GDP is on deck and is expected to show a quarter-on-quarter figure of 32.0% on an annualized basis following the -31.4% contraction in the preceding period. The strong bounce back was likely the result of strong fiscal and monetary stimulus, the effects of which may not be felt as
