By Stephen Culp
Jan 31 (Reuters) - A look at the day ahead in markets
from Stephen Culp, New York stock market reporter.
Wall Street's downbeat start to an action-packed week has set a
bumpy course for Asian markets on Tuesday.
U.S. stocks appeared to take a breather near the end of a
month of solid gains, dipping into red as market participants
gird their loins for multiple central bank policy decisions and
a spate of high profile megacap earnings, with the Labor
Department's hotly anticipated January employment report due on
Friday.
The Federal Reserve convenes its two-day monetary policy
meeting on Tuesday, which is expected to culminate on Wednesday
with a bite-sized 25 basis point hike to the Fed funds target
rate.
The Bank of England and the European Central Bank are poised
to follow the Fed by hiking crucial interest rates by a more
aggressive 50 basis points.
On the earnings front, Caterpillar Inc , General
Motors Co , Pfizer Inc , United Parcel Service Inc and McDonald's Corp are expected before
Tuesday's opening bell.
Meta Platforms Inc waits in the wings on Wednesday,
with Apple Inc , Amazon.com and Alphabet Inc on deck for Thursday.
Those earnings calls, along with Fed Chairman Jerome
Powell's post-rate-decision remarks, will be parsed and
scrutinized by investors for clues regarding the likelihood,
severity and timing of a potential recession.
Elsewhere, the U.S. dollar gained ground against a basket of
world currencies, crude prices plunged as the
prospect of rate hikes and robust Russian exports dampened
optimism over rebounding Chinese demand.
Speaking of which, the world's second-largest economy's
fiscal revenue growth decelerated sharply in 2022 to 0.6% from
10.7% in 2021, largely due to Beijing's strict COVID-19
policies.
Those policies have since been relaxed, sparking hopes of
demand revival in China, which could take some of the sting of
restrictive central bank policy.
Here are some key developments that could provide more
direction to markets on Tuesday:
- South Korea and Japan are expected to post December
industrial output and retail sales data
- China due to release manufacturing and composite PMI
reports for January
- U.S. will follow Case-Shiller home prices (November),
consumer confidence (January) and Chicago PMI (January)
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
The race to raise rates ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Reporting by Stephen Culp; Editing by Josie Kao)
