5 things to know before the Singapore market opens this week: Oct 12-19

Joggers run past the skyline of Singapore's financial district.
Joggers run past the skyline of Singapore's financial district.PHOTO: REUTERS

1. Big week for Singapore

Advance gross domestic product (GDP) figures out on Wednesday (Oct 14) at 8am will likely show that the Singapore economy slid into a technical recession in the third quarter - that's two consecutive quarters of contraction - weighed down by the China slowdown and a stagnant global economy. Economists polled by Bloomberg expect a quarter-on-quarter 0.1 per cent contraction in GDP. Year-on-year, growth is tipped to come in at just 1.2 per cent, the slowest quarterly rate since 2012

At the same time, the Monetary Authority of Singapore (MAS) will announce its semi-annual monetary policy decision - and it is too close to call. Economists say it is 50:50 whether MAS will ease the appreciation of the Singapore dollar to help exporters. While Singapore's current low inflation state and growth challenges could prompt an easing, MAS may want to hold off as a depreciation of the Singdollar could pressure short-term interest rates higher.

2. It's earnings season again

Singapore companies will be reporting their quarterly results starting this week, with oil and gas and property firms earnings expected to come under pressure. Highlights this week include SPH Reit and Singapore Press Holdings, which will announce their fourth quarter and full-year results on Monday and Tuesday respectively.

In the US, financial heanyweights JP Morgan Chase, Bank of America, Well Fargo, Citigroup and Goldman Sachs are all slated to release earnings this week.

3. China in focus

All eyes will be on China's September trade data on Tuesday (Oct 13) and inflation on Wednesday (Oct 14) for more clues on the health of the world's second-largest economy.

Any further weakness will reinforce expectations that Beijing will roll out more stimulus measures to ward off a sharper slowdown.

4. For the Fed, inflation is key

As investors around the globe try to figure out if there is still a chance of the Federal Reserve raising US interest rate rise this year, a key clue will come this week. Minutes from the Fed's September meeting, released last week, revealed worries about inflation being stuck at growth-unfriendly levels. That makes numbers like the consumer-price index, out on Thursday (Oct 15), of special interest. Ahead of that come US retail sales figures and the producer-price index, on Wednesday.

Four voting members of the Fed's rate-setting Federal Open Market Committee also speak this week.

5. EU summit mulls Britan's EU referendum

European Union heads of state and government will meet in Brussels on Thursday and Friday for their regular October summit. The main item on the agenda will be how to deal with the ongoing migration crisis. But they will also discuss the state of the economic and monetary union and Britains plans to hold a referendum on remaining in the EU.

Sources: Wall Street Journal, Reuters