Week Ahead: UK, Eurozone, US and China Data to Determine Global Stock Market Direction

Global markets will this week take their cues from a raft of data including labour market figures from the UK, the eurozone's Sentix sentiment index and industrial production, US retail sales data and China's industrial output measure.

They will also be tracking central bank rate decisions in Iceland and New Zealand.

The UK puts out its unemployment rate on 11 June, forecast to ease to 6.7% in April from 6.8% in March, fuelling speculation about when interest rates could rise.

Central Bank Lookout

Elsewhere, Iceland's central bank announces its rate decision on 11 June.

Capital Economics said in a note to clients: "The small fall in Icelandic GDP in the first quarter of 2014 was somewhat disappointing but we do not think that this marks the start of a renewed deterioration in the economy.

"Nonetheless, the steady improvement in domestic demand bodes well for the overall economic recovery. As a result, the output gap is likely to be closed this year, despite the weaker economic performance in Q1."

"Accordingly, while we think that Iceland's central bank will stand pat at its meeting next week, we still expect it to raise rates by 25bp later this year to 6.25%," Capital added.

New Zealand's central bank will reveal its rate decision on 12 June.

Commerzbank Corporates & Markets said in a note: "The RBNZ is likely to hike its key rate further, from 3% to 3.25%, with the economy growing at a strong rate and capacity utilisation rising. Whether the next steps will be implemented as announced will mainly depend on the NZD exchange rate as its high value and falling import prices are dampening inflationary pressure.

"In early May, Governor [Graeme] Wheeler reiterated that he considers the currency to be over-valued, signalling interventions if the currency were not to react to softer data such as tumbling export prices. The NZD has depreciated since but the low level of interest rates world-wide and the general hunt for yield are limiting corrections - and therefore the RNBZ's scope. We expect it to adjust interest rates only once more in H2."

In the UK, the Mansion House dinner in London on 12 June will give Bank of England (BoE) Governor Mark Carney an opportunity to comment on how to soothe housing market hot spots, particularly London.

A key focus on 12 June will be US retail sales data for the month of May. Retail sales in the world's largest economy are expected to rise 0.6% month-on-month after slowing to 0.1% in April, following strong gains in March and February.

BOJ Stimulus

On 13 June, the Bank of Japan (BoJ) is likely to leave its massive monetary stimulus unchanged.

Market players will comb Governor Haruhiko Kuroda's comments for clues about the future pace of BOJ stimulus amid fading expectations for fresh stimulus.

Capital Economics said in a note to clients that "more [BOJ] easing will only be announced in late October [2014]."

Analysts will also be tracking China's industrial output data for the month of May, due out on 13 June, to determine if the world's second-largest economy is regaining momentum. The consensus forecast is for 8.8% output growth year-on-year, up from 8.7% in April.

Elsewhere, 13 June's US producer prices data for the month of May, a substitute for consumer inflation, could reveal whether second-quarter acceleration in the American economy is fuelling inflation.