Next week's heavy schedule: Federal Reserve, US stock earnings reports, and Trump, which will have surprises?

From January 27 to February 2, a summary of major financial events, all in Beijing time:

Key focus for next week: The Federal Reserve and the European Central Bank will successively release interest rate decisions, along with GDP data for the fourth quarter of Europe and the U.S. and the core PCE inflation index, as well as earnings reports from tech giants like Apple and Tesla.

In addition, there will be Trump's remarks on tariffs on February 1, the A-share market and several Asian markets will be closed for the Spring Festival, and U.S. Senate committee hearings will review Trump's nomination of Howard Lutnick as Secretary of Commerce. Hongmeng Zhixing will push OTA updates, and the Hongmeng Zhixing Zun Jie S800 will be unveiled.

"Super Central Bank Week" Approaches

On Thursday, the Federal Reserve and the European Central Bank will successively release interest rate decisions, and the central banks of Sweden, Canada, Brazil, and South Africa will also announce their interest rate decisions.

• Federal Reserve FOMC Releases Interest Rate Decision

First, the Federal Reserve's interest rate decision will be announced at midnight next Thursday, Beijing time. Against the backdrop of strong demand and persistent inflation, it is widely expected that borrowing costs will remain stable. At the December meeting, policymakers hinted that there would only be two rate cuts this year.

Currently, the CME Group's "FedWatch" tool shows that the market expects only a 2.1% probability of a 25 basis point rate cut next week.

PIMCO Chief Investment Officer Ivascyn believes that the Federal Reserve needs to wait for further clarity on Trump's policies and U.S. economic data. Recent consumer surveys show a rebound in inflation expectations, indicating that the possibility of rate hikes "does exist"; he also warns that the current valuation gap between U.S. stocks and bonds is nearing historical extremes, and if hawkish policies push up U.S. Treasury yields, U.S. stocks may come under pressure simultaneously.

Nevertheless, Trump has recently pressured the Federal Reserve multiple times, calling for rate cuts to stimulate the economy, which undoubtedly adds suspense to the market. Additionally, the Federal Reserve's rhetoric will also influence U.S. stock market sentiment and capital flows, and investors need to closely monitor Federal Reserve Chairman Powell's press conference.

• European Central Bank Releases Interest Rate Decision

The European Central Bank's Governing Council will make its first rate cut decision of the year on Thursday, almost certainly lowering rates by 25 basis points. Investors will look for clues in the subsequent press conference by ECB President Lagarde.

Due to policymakers' concerns about potential tariffs imposed by Trump and a relatively optimistic view on inflation risks, the possibility of further rate cuts is high.

ECB President Lagarde previously stated in a media interview that the ECB will continue to gradually cut rates, emphasizing that the ECB will consider a gradual approach to rate cuts, and policymakers are confident that the inflation rate will reach the 2% target by 2025.

U.S. and European GDP Data

The economic data for the week is also worth noting. The preliminary report on U.S. fourth-quarter real GDP and personal consumption expenditures (PCE) data will be released in succession, while the core PCE is the Federal Reserve's preferred inflation indicatorIn addition, the GDP of the Eurozone, including Germany and France, will also be released for the fourth quarter.

Economists surveyed by Bloomberg predict that the preliminary estimate of the fourth quarter GDP (i.e., the total production of goods and services) shows an annualized growth rate of 2.7%. Previously, the growth rate in the United States had reached around 3% for two consecutive quarters. This is attributed to a strong labor market, which helps explain why the U.S. continues to outperform Europe and other developed economies around the world.

The monthly household spending data released on Friday may indicate continued growth momentum into 2025. Economists also expect that the personal income and spending report will show a slight rebound in the core PCE, the inflation indicator favored by the Federal Reserve, compared to the previous month.

In stark contrast to the U.S., data expected in the coming week is anticipated to show that the French economy stagnated in the last few months of 2024, while the German economy is expected to shrink slightly.

The Eurozone GDP data, also scheduled for release on Thursday, is expected to show weak economic growth in the Eurozone, continuing a trend of low performance over the years. The contraction of the German economy, stagnation of the French economy, and slight expansion of the Italian economy are dragging down the overall economy of the region, which is expected to grow by only 0.1%.

Financial Reports from Tech Giants like Apple and Tesla

As the U.S. earnings season reaches its peak, tech giants and energy stocks in the U.S. stock market, as well as luxury stocks in the European market, will successively announce their performance.

For U.S. tech companies, the earnings reports of giants like Apple, Microsoft, Meta, and Tesla from the Mag7 will be concentrated on Wednesday and Thursday. The market is generally focused on whether Apple can continue to maintain growth, while attention on Tesla is centered on its delivery data and future growth potential. The release of both companies' earnings reports may shake the U.S. stock market.

In the AI chip sector, companies like ASML, Intel, and IBM will release their earnings reports. In the third quarter, ASML's orders were only half of market expectations, and due to weak demand in non-AI sectors, the company has lowered its sales guidance for 2025, with performance in AI orders for the fourth quarter still to be determined.

Additionally, on Friday, ExxonMobil and Chevron, two oil and gas companies, will release their earnings reports, while European luxury stock Louis Vuitton will announce its earnings on Tuesday.

A-shares and Several Asian Markets to Close for Spring Festival

According to the notice issued by the Shanghai and Shenzhen Stock Exchanges regarding the Spring Festival holiday arrangements for 2025, the market will be closed from January 28 (Tuesday) to February 4 (Tuesday), totaling 8 days, and will resume normal trading on February 5 (Wednesday). Additionally, January 26 (Sunday) and February 8 (Saturday) are weekend closures.

For the Hong Kong Stock Connect under the Shanghai-Hong Kong Stock Connect/Shenzhen-Hong Kong Stock Connect, the Shanghai and Shenzhen Stock Exchanges stated that there will be no Hong Kong Stock Connect services from January 28 (Tuesday) to February 4 (Tuesday), and the services will resume as usual on February 5 (Wednesday). Moreover, January 26 (Sunday) and February 8 (Saturday) are weekend closures.

Furthermore, the Hong Kong stock market will begin its holiday from the afternoon of January 28 and will also be closed until February 4, while the Taiwan Stock Exchange will be closed until January 31.

In other Asian countries, the Seoul Securities Exchange in South Korea will be closed until January 30, and the Hanoi Stock Exchange in Vietnam will be closed until January 31

Attention to Tariff Situation on February 1

Trump 2.0 tariffs have become a focal point. Although there is a noticeable absence of executive orders regarding trade tariffs, according to CCTV news, Trump initially mentioned the possibility of imposing a 25% tariff on imported goods from Canada and Mexico starting February 1.

Subsequent comments later this week were not as strong—considering a 10% tariff on imported goods from China—though they highlighted how much trade discussions are still changing. It is understandable that the government is finalizing details, including scope, extent, and implementation.

Deutsche Bank previously stated that the presidential memorandum provides more executive power for the president to implement tariffs, and the Trump administration seems intent on creating uncertainty, so the market should not be overly complacent. April 1 will be an important date, as the memorandum directs certain departments and agencies to conduct specific reviews and release reports before then, which could be a catalyst for new tariff proposals.

Other Important Data, Meetings, and Events

• U.S. Senate Committee Reviews Trump's Nomination of Howard Lutnick as Commerce Secretary

The U.S. Senate committee will hold a hearing on January 29 to review Trump's nominee for Commerce Secretary, Howard Lutnick. Lutnick has worked on Wall Street for many years and has extensive connections in the U.S. financial circle, being one of Trump's main fundraisers during this election cycle.

It is reported that Lutnick, the nominee for U.S. Commerce Secretary, has assets of at least $800 million and is associated with 800 companies. Documents released by the U.S. Office of Government Ethics also show that he holds roles in at least 800 legal entities. Disclosure information indicates that Lutnick's assets are valued at least $806 million, with some assets exceeding $50 million. Lutnick listed 12 assets within this range, including holdings in Cantor Fitzgerald, Newmark, and BGC.

• Hongmeng Zhixing Pushes OTA, Hongmeng Zhixing Zun Jie S800 Debuts

On January 23, Hongmeng Zhixing announced that it will push an OTA on the 27th of this month, covering over 80 functional upgrades across five core areas: intelligent driving, cockpit, safety, entertainment, and connectivity, which will be applied to all currently sold models of Aito, Zhijie, and Xiangjie.

Additionally, recently, Huawei Executive Director Richard Yu released a video on Weibo. He previewed that the "Era Flagship" Zun Jie S800 under Hongmeng Zhixing will appear on the Spring Festival Gala, and also revealed the new car's black technology—integrated perception light curtain glass, which uses advanced dye liquid crystal technology to achieve precise control of liquid crystal molecular deflection through voltage, enabling a response speed of less than one second for dimming. Moreover, it innovatively introduces integrated perception gesture dimming technology, allowing users to easily adjust the rear glass through high-precision sensors that recognize user gestures. Users can simply slide their fingers to control the brightness of the glass, showcasing luxury.

New Investment Opportunities

During the week (January 27 - January 31), there will be 2 new stocks listed in the A-share market, namely N Yalian and N Haibo. The U.S. stock market will see 8 new stocks listed. A total of 1 new fund was issued this week (A class and C class combined).

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