The Week Ahead: Andy Burnham become PM as UK inflation and jobs data land; Tesla, Alphabet, Intel headline earnings season

Andy Burnham will become Britain's seventh prime minister in 10 years on Monday, 20 July after taking over as Labour leader on Friday. Markets should quickly start to get a sense of what's in store on the economic and fiscal side of policy. His biggest decision will be who to name as Chancellor to replace Rachel Reeves. 

Earnings season kicks into gear in Europe and the US, with results from Tesla, Alphabet and Intel among the highlights on Wall Street in a packed calendar with nearly 80 S&P 500 companies reporting.

Here’s the key events to watch over the next week.

Monday, 20 July

Andy Burnham is sworn in as the UK prime minister, the seventh in the 10 years since the Brexit vote. The focus will instantly be on who he names in his Cabinet, with market attention squarely on his choice of Chancellor. Reports indicating he will name Shabana Mahmood – instead of ally Ed Miliband – was apparently welcomed by investors as sterling rallied to its highest level against the euro in over a year. This will be more about a signal to the market – the hard work starts and a Budget in the autumn will be critical. There has been no scrutiny of Mr Burnham – this will begin in earnest this week.

Data is light to start the week – Canada CPI, China loan prime rates, German wholesale inflation and the US Conference Board leading index are among the economic releases to consider.

Ryanair reports its fiscal Q1 results after scrapping is full-year guidance in May due to the surge in jet fuel prices and some negative headlines about family seating fees and a broken window mid-flight.

Tuesday, 21 July

The focus early is the UK's unemployment, average earnings and jobless claims figures. The weakness in the labour market has been a constant concern for the Bank of England and underscored why there is no need to raise interest rates despite the uptick in inflation from the Middle East conflict. Although the unemployment rate ticked down to 4.9% from 5.0%, payrolls were down 0.5% on the year to April and were –0.4% lower to May based on early estimates, while job vacancies continued to decline to the lowest level since 2021. Against such a weak hiring environment wage growth has also notably cooled with private sector earnings growth at a five-year low.

Earnings from 3M and General Motors are the highlights on Wall Street, while Compass Group and Novartis also report earnings.

Wednesday, 22 July

UK CPI inflation data for June is the main macroeconomic event. CPI unexpectedly held steady at 2.8% in May against forecasts for it to rise to 3% as benign food inflation kept the headline print in check. Services inflation, which is a bit stickier, did climb to 3.7% from 3.2% from April. Core inflation also edged up to 2.6% from 2.5%, but we are a long way off the 4% level that you’d think would call for a rate hike against such a difficult economic backdrop and soft labour market.

The busiest day for earnings sees Tesla and Alphabet kick off the Magnificent 7 reporting season. Read my Tesla earnings preview here. For Alphabet, it's going to be a familiar story of AI capex vs ad and cloud earnings growth. This is a key test for the market as the first hyperscaler to report earnings in the wake of the selloff in semis: is the AI capex supercycle still in play? AT&T, GE Vernova and ServiceNow are also slated to report earnings.

Europe has a packed earnings calendar with Akzo Nobel, Alstom, Dassault Aviation, Moncler, Santander and Iberdola among the highlights. And it the European Commission’s provisional deadline for a decision on Paramount Skydance’s proposed acquisition of Warner Bros Discovery.

Thursday, 23 July

The European Central Bank is expected to leave interest rates unchanged after hiking at its last meeting. The ECB raised its key deposit facility last month to 2.25%, the first hike in nearly three years. Whilst markets have priced in another 25bps increase this year, there is only a roughly one-in-five chance it pulls the trigger at this meeting, with investors believing policymakers will want to wait and see more incoming data on inflation before acting again. Eurozone inflation fell more than expected to 2.8% in June but oil has risen sharply since that more benign environment after the re-escalation of military action in the Middle East by the US and Iran.

Intel headlines the earnings calendar on Wall Street, presenting investors another guide on the semiconductor sector. In the UK results come from 3i Group, Anglo American, BT, Centrica, Halma and easyJet, which is currently subject of a takeover battle. European stocks to report include BE Semiconductor Industries, Nestle, Roche, SAP, STMicroelectronics, BNP Paribas and Carrefour.

Friday, 24 July

PMI day: Surveys for manufacturing and services activity will shape the market's view of the global economy. We will pay close attention to the price components to watch for signs of a buildup of inflationary pressures.

Meanwhile tariffs are back on the agenda as the temporary 10% US global import tariff is set to expire unless Congress extends it.

RELX and Volkswagen top a fairly light calendar of earnings releases.