In the Global Week Ahead, the Trump administration kicks off its first 100 days.
Much like whitecaps hitting shore on a stormy lake, expect this President's executive orders to land in a fast and furious fashion.
These could include: orders on immigration policy, withdrawing from the Trans-Pacific Partnership (the TPP), establishing a group to renegotiate NAFTA and firing off a letter to leaders in Canada and Mexico, approving the Keystone pipeline, boosting coal and repealing some gun control legislation.
Acting like another Loch Ness monster, the Brexit serpent agitates the political waters in the U.K.
On Tuesday, the U.K. Supreme Court should affirm a lower court ruling: The U.K. Parliament must vote to trigger Article 50. FX strategists write of any subsequent U.K. pound rally as "limited and short-lived."
Despite strident political activism here and across the pond, a strengthening U.S. economy will endure. This is the deep water beneath the surface. On Friday in the U.S., the latest snapshot of real GDP growth hits the tape.
According to the Jan. 19th GDPNow forecast, real GDP growth should be supportive at +2.8% in Q4. This is down a bit from a +3.5% Q3 final rate. Mind you, Q4 data serves up a preliminary estimate. There are 2 revisions down the road.
All week long, stock traders also digest a steady diet of Q4 EPS reports.
More than 20% of S&P 500 companies report Q4 results this week. The list includes large-cap marquees -- Google-parent Alphabet, Yahoo, Intel, Microsoft, McDonald's, Starbucks, Boeing, Lockheed Martin, Comcast, Verizon, Ford, 3M, Dow and Caterpillar.
Hint: Take Q4 U.S. real GDP growth - add +2% as a proxy inflation gain -- and compare the sum to nominal revenue growth reported by each U.S. company. That compare-and-contrast exercise should be provocative about where outperforming revenue growth can be found in the U.S. economy.
When writing this week's column, I used the analogy of a stormy lake as a literary device. I use what I learned, spending summers as a boy in Northern Minnesota. Whitecaps from strong winds can churn the surface all they want. The deep lake beneath can remain relatively calm, moved only by hidden currents.
Top Zacks #1 Rank (STRONG BUY) Large Cap Stocks-
(1) Goldman Sachs GS
Goldman Sachs is a global investment banking and securities firm, providing a full range of investing, advisory and financing services worldwide to a substantial and diversified client base.
(2) Honda Motor HMC
Honda manufactures a wide range of products, including motorcycles, ATVs, generators, marine engines, lawn and garden equipment and automobiles. Historically, Honda has been a leader in fuel-efficiency and low-emission technology.
(3) Posco PKX
POSCO was formerly known as Pohang Iron & Steel Company Ltd. In South Korea, it manufactures hot and cold rolled steel products, heavy plate and other steel products for the construction and shipbuilding industries. It is the world's 4th largest steelmaker, at 42 million tons of crude steel output in 2015.
Key Global/Macro Data-
This week, the big market-moving reports should be EPS reports. The only major macro fundamental out is U.S. Q4 GDP on Friday.
On Monday , the unemployment rate in Taiwan should be around the prior 3.84%.
On Tuesday , the South African Reserve Bank (SARB) monetary base rate should remain at 7.0%.
The U.K. Supreme Court is to hand down a judgment on Brexit/Article 50.
The Eurozone's preliminary PMIs for manufacturing and services come out. The Eurozone composite should be 54.5, with manufacturing at 54.8, and services at 54.
For comparison, the U.S. preliminary manufacturing PMI should be 54.3, on a par with the Eurozone's manufacturing PMI at the moment. With the USD at a 14-year high, this equates to impressive U.S. relative strength.
U.S. existing home sales should be 5.58 million, about the same as the prior 5.61 million existing home sales number.
On Wednesday , Germany's important IFO indices come out. Business climate should be 11.2, current conditions 116.8 and expectation 105.7. Those are all marking time at a high, stable level.
Russia's unemployment rate should be 5.4%. That shows you a deceitful government leader can indeed maintain a full employment economy. Just saying!
Mexico's retail sales should be up +7.3% y/y. This is down from the prior +9.3% y/y retail sales data. Is that to be interpreted as the first sign of an internal slowdown? The Mexican peso is now exchanged at 21.6 to the USD.
On Thursday , the unemployment rate in open Singapore looks to be 2.2%.
Singapore's industrial production should be up +11.0% y/y. That shows you what an open Asian entrepot can achieve.
The U.K.'s Q4 GDP growth should be +2.2% in y/y terms. This is a 1st estimate.
U.S. initial unemployment claims should be 234K.
On Friday , U.S. durable goods orders should be up +1.5% m/m, and ex-transport, up +0.5% m/m.
U.S. Q4 GDP growth should be a preliminary +2.8%, after a +3.5% in Q3.
University of Michigan sentiment should linger around the prior 98.1.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.