It is time to stop and smell the roses (or cherry blossoms at least) as we head into the second month of Spring. May starts on a sparkling note with Japan taking the entire week off for the Golden Week holidays and China celebrating the labor movement with a four-day vacation. With China and Japan taking a nice long break, investors will depend on U.S. and Australian economic data to move the markets in the week ahead.
Starting with a little earnings news on Saturday, Sensex trackers will keep an eye on ICICI Bank to see if any luck from this week’s rally will rub-off on India's top lender. It will report fourth-quarter earnings. Analysts predict that ICICI will face pressure in earnings growth because of a provision recently imposed on standard assets.
It’s show time for Kookmin Bank on Sunday. South Korea’s largest commercial lender is scheduled to report first-quarter 2007 earnings results. Market participants are expecting a 35% increase in net profit from a year earlier. Just a few weeks ago, Kookmin Bank made headlines after falling in to a round of controversy over its intended sale to Texas buy-out firm, Lone Star.
On Monday, Japan kicks off the Golden Week holidays by commemorating the birth of the emperor Shouwa. And other investors in the region, who are not on vacation, will be watching to see if the U.S. Chicago PMI data can top the previous month’s unexpected two-year high at 61.7%. Barclays Capital says that the March reading revealed a recovery in the region’s manufacturing activity that should carry on into April, especially given the surge in March new orders.
Tuesday will see most of the Asian markets close for the Labor Day holiday. Australia’s fourth and fifth largest lenders (St. George Bank – Wednesday, Westpac – Thursday) will report their first-half earnings consecutively at the midweek. Analysts predict all top five Australian banks will post solid profit growth for 2007.
Down Under, the Reserve Bank of Australia will make a decision on interest rates Wednesday. Analysts believe the RBA will keep the benchmark 6.25% rate unchanged after last week's softer-than-expected inflation numbers.
And as Friday rounds the corner all eyes will be on Qantas Airlines, the deadline for the US$9 billion takeover bid led by the Macquarie Bank and Texas Pacific consortium – Airline Partners Australia. It's become increasing doubtful that the consortium's decision to lower the acceptance condition from 90% to 70% will be the knock-out blow needed to get the deal across the line. But we will find out for sure on Friday.
Singapore’s Creative Technologies will post third-quarter earnings results on Wednesday, May 2 at 8:00 a.m. Singapore.
Other major company earnings to be released in the workweek ahead include: