Markets’ week ahead: Dubai Airshow kicks off, aerospace stocks rejoice

The Dubai Airshow launched on Monday, with investors anticipating billions of dollars worth of new orders, pulling up aerospace stocks.


The 18th Dubai Airshow started on Monday at the Dubai World Central, with 95 countries in attendance, hosted by Emirates and flyDubai. The event is expected to set the stage for a slew of new aircraft orders, going well into the tens of billions.

This includes a potential Emirates order for more Boeing 777X and 787 jets, the total of which is estimated to be somewhere around $52 billion. The Middle-Eastern airline is also looking into another Airbus order, focused on A350 carriers.

Turkish Airlines is another possible major rival, reportedly in talks with Airbus as well, for an order of 355 new carriers. These would range across the A350-900, A350-1000 and A350F amongst others. Depending on government approvals, this order size could increase to about 600 jets, over the span of 10 years.

Saudi Arabia, an emerging player, could also put in an order of about 100 Boeing 737 jets, for its newly-launched Riyadh Air.

European markets pulled up by aerospace stocks

The CAC 40 index was on the rise on Monday morning, inching up 0.53% to trade at €7.082.1, mainly boosted by aerospace stocks. Airbus was on the top gainers on the CAC 40 index on Monday morning, with a 1% rise on the day, clocking in at €130.1. Boeing also saw a 1.72% hike, trading at $196.6.

Public relations company Publicis was on the bottom end of the CAC 40 on Monday, after recently announcing a new management team. Cosmetics giant L’Oreal was one of the other biggest losers. The company has recently announced a new extraction process for fragrances, which will be primarily “based on air”.

Coming to European earnings, Bayern Munich has posted record total revenues of €854.2 million for the 2022-2023 season. This is a rise of about 30% from the last year, and points towards the football club’s resilience even during the pandemic.

What to watch in the week ahead

Later this week, investors look ahead to crucial US-China talks taking place on Wednesday, in San Francisco. The Xi-Biden summit will mainly focus on US-China trade relations, the tense situation in Taiwan and how both superpowers can embrace greater coordination. Sensitive issues such as cyber-spying and semiconductor export sanctions are also likely to be on the agenda.

The OPEC monthly report will be released later on Monday.

The German ZEW economic sentiment index for November will be out on Tuesday, with expectations of it clocking in at 5, significantly up from Octobers -1.1. This may indicate how far Germany has come in recovering from the effects of the recent growth slowdown.

Investors are also looking forward to the year-on-year US inflation print for October, due on Tuesday. This is expected to come down to 3.3%, from 3.7% in September. This figure will be crucial in determining whether the US Federal Reserve continues to hold interest rates at its next monetary policy meeting or not.

The UK year-on-year inflation rate for October will be out on Wednesday and is estimated to come down even more sharply than US inflation, to 4.8%. If so, this will be a significant step down from September’s 6.7%.

Along with these, retail sales numbers from US, UK and China are also on the agenda, as well as GDP numbers from Japan.