The Week Ahead: Will US raise interest rates for the first time since 2006?

Investors will be keeping tabs on the price of gold, which tends to swing in the opposite way to the dollar, given its safe-haven appeal

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The Independent Online

Investors’ gaze this week shifts from east to west as China plays second fiddle to the crucial decision Stateside on whether to raise interest rates for the first time since 2006.

Most expect the US Federal Reserve will opt to delay a rise when it reveals its choice on Thursday, despite having previously targeted September as the month to pull the trigger.

An increasingly brighter outlook for the world’s largest economy had its rate-setters hinting strongly at a rise this month, but stock market volatility in China triggered by fears over its slowing growth has cast a shadow over global markets and prompted the US to think twice about increasing rates this soon.

Some analysts suggest a rate hike is off the cards, while others think events in China are irrelevant to America’s own recovery.

Investors will be keeping tabs on the price of gold, which tends to swing in the opposite way to the dollar, given its safe-haven appeal. That means the stock performances of UK-listed gold producers, such as Randgold Resources and Acacia Mining, will hinge on the Fed’s stance.

Corporate news is thin on the ground, with Galliford Try’s annual results on Wednesday the pick of the bunch. It is one of the last housebuilders to unveil full-year figures, with record profits and share price highs becoming regular occurrences.

Kingfisher’s half-year results will show how the B&Q owner fared over the key summer trading months after rival DIY chain Homebase revealed strong sales last week.

Gateley reveals its annual results – its first set of figures since it became the UK’s first listed law firm in June.

Other notable companies reporting results include JD Sports, whose first-half results are out on Wednesday, while an update from Merlin Entertainments will reveal the extent of the fallout from the Alton Towers roller-coaster crash.

This week also sees the opening of the first new metals mine in the UK for 45 years. Wolf Minerals, which is dual-listed on AIM and Australia’s ASX, is unveiling a tungsten and tin project in Devon – no mean feat given the mining sector’s recent woes.

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