Continuing weakness out of Europe, a wave of sovereign credit downgrades and an early reading on the weak Chinese manufacturing PMI index spooked the global markets last week. Where do we go from here?
Combined with a shortened trading week in the U.S.and lower volume, the bearish factors led the S&P500 down for its second week in a row and the iShares MSCI Emerging Markets Index ( EEM , quote ) down its fourth consecutive week.
Hungary, Belgium and Egypt saw their ratings downgraded and India opened the way for large-cap retailers to enter the country.
Despite the weak global data, Kazakhstan managed to get a credit upgrade from Fitch to BBB from BBB-, following the upgrade from Standard & Poor's in November. Fitch kept the outlook on positive which means that another upgrade could come within the next year.
Monday, November 28
Peru will release its third-quarter GDP numbers on Monday. The country is expected to be one of the standouts in the region with a 2011 forecasted GDP growth of around 6%.
Chinese technology company Taomee Holdings ( TAOM , quote ) reports earnings after the closing bell with a consensus of $0.09 per share.
Tuesday, November 29
Hungary's Central Bank chiefs meet after revealing last week that the government had initiated talks with the IMF about a new loan. Despite Prime Minister Orban's previous promise to step down if the country was forced to do this, the populist government seems to be somewhat stable. The market is not pricing in a movement in rates from 6.0%. If anything, the risk is to an increase in rates to curb recent depreciation in the forint.
Private sector credit in South Africa is expected to increase marginally from September's reading of 5.47% to the consensus of 5.67%.
Chinese consumer services company Global Education & Technology Group ( GEDU , quote ) reports after the bell with a consensus estimate of $0.15 per share. Despite slowing manufacturing growth in the country, consumer services are still doing relatively well.
Kong Zhong Corp. ( KONG , quote ), the Chinese tech giant, also reports earnings (consensus of $0.10 per share) after the closing bell.
Wednesday, November 30
Both the Thai and Brazilian Central Banks convene on Wednesday. Against weak economic data, the Brazilian bank is widely expected to cut rates by at least half a percent to 11.0% though the risk remains to the downside with a cut of 0.75%. Inflation in the South American powerhouse remains high at 7% but is expected to come down.
Turkey releases October trade balance numbers from a September deficit of $10.4 billion USD.
Poland's third-quarter GDP is released and expected to fall to around 4.1% from the second quarter reading of 4.3%. Risk here is to the downside as weakness from main trading partners reduces exports.
South Africa also releases third-quarter GDP and is expected to match the second quarter reading of 3.0%.
Chinese technology company Camelot Information Systems ( CIS , quote ) reports before the opening bell with a consensus estimate of $0.05 per share.
Thursday, December 1
China will release manufacturing PMI after spooking the markets with a early estimate last Wednesday. The flash reading of 48.0 compared to a reading of 51.0 for October and denoted weakness in the Asian giant. The forecast for the actual release is higher, at 49.5 but still below the important delineator for growth.
The Hungarian PMI reading, forecast 47.0 from a previous 48.2, will most likely be overshadowed by the torrent of PMI numbers released from China, Russia, Turkey and Poland but may cause the forint to depreciate further if the number shows dramatic weakness.
Russia's manufacturing PMI is expected to break the important 50.0 reading separating growth and weakness. October's reading was just above at 50.4 but forecast estimates are all below the cutoff index reading for growth. Despite a weak manufacturing sector for the quarter, the country is still expected to grow by 4%-5% for the second half of the year.
Both Turkey and Poland release manufacturing PMI data as well, although are expected to remain above the 50.0 mark. Previous readings for Turkey and Poland were 53.3 and 51.7, respectively.
Shanda Interactive Entertainment ( SNDA , quote ), the Chinese Web company, will report after the bell with a consensus estimate of $0.22 per share, but could surprise to the upside on continued growth in the consumer market.
Friday, December 2
China non-manufacturing PMI out on Saturday against a previous reading of 57.7 against weak manufacturing data earlier in the week. Weakness in manufacturing may keep the central bank from allowing the yuan to appreciate as fast as previously expected.