Investing.com - Geopolitics could hang over the market in the coming week, as investors look ahead to an unprecedented meeting between U.S. President Donald Trump and Russian President Vladimir Putin on Monday.
The week ahead also marks the first big week of the second-quarter earnings season on Wall Street, with names like Netflix, Goldman Sachs, IBM and Microsoft set to report.
There will also be important testimony from Federal Reserve Chair Jerome Powell, who appears Tuesday and Wednesday before congressional panels on the economy and monetary policy.
Several important economic reports also expected, with retail sales on Monday topping the list.
Elsewhere, in Asia, China is slated to release what will be closely watched second-quarter growth data, amid warnings from analysts that the recent trade dispute with the U.S. could drag on economic activity.
Market focus is also largely attuned to the next potential steps of the U.S.-China trade conflict. The U.S. threatened 10% tariffs on an extra $200 billion worth of Chinese imports last week. However, a lack of response from China to these levies so far has assuaged some fears of conflict escalation.
Trade-war fears have been simmering for months, keeping market gains in check with investors jittery over the prospects of further escalation in tensions between the world's two largest economies having an impact on economic growth.
Ahead of the coming week, Investing.com has compiled a list of the five biggest events on the economic calendar that are most likely to affect the markets.
1. Trump-Putin Summit
U.S. President Donald Trump and Russian President Vladimir Putin hold their first summit in Helsinki, Finland on Monday.
Neither side expects the one-day summit to yield major policy breakthroughs given the battered state of U.S.-Russia relations, which are languishing at their lowest ebb since the Cold War.
Geopolitical analysts expect Putin to urge Trump to soften sanctions imposed over Ukraine, while Trump has said he will press Putin on everything from allegations of meddling in the 2016 U.S. election to the war in Syria.
On Friday, some lawmakers pressed Trump to cancel the summit after Special Counsel Robert Mueller indicted 12 Russians for interfering in the general election.
Meanwhile, European leaders will be watching the outcome closely, especially after Trump called Germany a "captive" of Russia at a testy NATO summit in Belgium last week, due to its plans for a major new gas pipeline.
2. U.S. Q2 Earnings Season Kicks Into High Gear
There are about 60 S&P 500 companies reporting earnings in the week ahead, including seven Dow stocks, in what will be the first big week of the second-quarter earnings season.
Bank of America (NYSE:BAC) and BlackRock (NYSE:BLK) report Monday, along with tech darling Netflix (NASDAQ:NFLX).
Tuesday sees Goldman Sachs (NYSE:GS), Johnson & Johnson (NYSE:JNJ) and UnitedHealth (NYSE:UNH) post results.
On Wednesday, Morgan Stanley (NYSE:MS), American Express (NYSE:AXP) and IBM (NYSE:IBM) report earnings.
Microsoft (NASDAQ:MSFT), Advanced Micro Devices (NASDAQ:AMD) and Blackstone (NYSE:BX) are on the docket Thursday.
Finally, corporate results from General Electric (NYSE:GE) and Honeywell (NYSE:HON) round up the week on Friday.
Analysts have said they are expecting another strong quarter, with earnings growth at around 21%, according to Thomson Reuters data. However, the season is being clouded by trade tensions and their impact on corporate profits, with analysts likely to scrutinize outlook statements to see if companies discuss the impact of Trump's trade policies on future spending plans, input costs and profitability.
3. Fed Chair Powell Testifies
Federal Reserve Chair Jerome Powell is set to deliver his semi-annual monetary policy testimony on the economy before Senate and House committees in Washington DC.
Powell is scheduled to testify on the economy before the Senate Banking Committee at 10:00AM ET Tuesday. On Wednesday, he will appear in front the House Financial Services Committee also at 10AM ET.
Text of the testimony will be released 90 minutes before he starts speaking.
Powell's comments will be monitored closely for further clues on when and how fast the Fed will raise interest rates.
The Fed's semi-annual report on monetary policy, sent to Congress last Friday, pointed to "solid" U.S. economic growth and reiterated its plans to continue raising interest rates gradually.
4. U.S. Retail Sales
The Commerce Department will publish data on retail sales for June at 8:30AM ET Monday.
The consensus forecast is that the report will show retail sales rose 0.4% last month, moderating from a gain of 0.8% in May.
Excluding the automobile sector, sales are expected to increase 0.4%, after a 0.9% rise a month earlier.
Rising retail sales over time correlate with stronger economic growth, while weaker sales signal a declining economy. Consumer spending accounts for as much as 70% of U.S. economic growth.
Besides the retail sales report, this week's calendar also features U.S. data on building permits, housing starts, industrial production, as well as surveys on manufacturing conditions in the Philadelphia and New York regions.
On the central bank front, the Federal Reserve's Beige Book will be in focus.
The U.S. central bank hiked interest rates last month for the second time this year and has projected two more rate increases by year-end.
Traders are currently pricing in around an 85% chance of a rate hike in September, according to Investing.com’s Fed Rate Monitor Tool. Odds of a fourth rate hike by December was seen at about 55%.
5. China Q2 GDP
China will be the first major economy to report second-quarter growth data when it publishes its GDP numbers at around 0200GMT on Monday (10:00PM ET Sunday).
The report is expected to show the world's second-largest economy grew 6.7% in the April-June period, moderating slightly from growth of 6.8% in the first quarter.
The Asian nation will also publish data on June industrial production, fixed asset investment and retail sales along with the GDP report.
China, the world's largest exporter, has so far escaped any major blow to its foreign trade sector despite rising trade tensions with the U.S.
Washington and Beijing appeared increasingly headed toward open trade conflict after several rounds of negotiations failed to resolve U.S. complaints over Chinese industrial policies, lack of market access in China and a $375 billion U.S. trade deficit.
Stay up-to-date on all of this week's economic events by visiting: http://www.investing.com/economic-calendar/