Credit: Shutterstock photoFollow me on twitter @johnblank100
Trading action often follows closely upon the heels of major political action.
In light of that idea, observers might think a political failure to freeze global oil production in Doha, Qatar last weekend would sour oil traders more than it has. Oil demand and supply is set to support prices anyway.
This market's balance kept winding tighter over time. Seasonally, the summer driving season is nearly here. Structurally, U.S. rig counts are at historic multi-year lows. Cyclically, global GDP seemed to mark a turn up recently -- thanks to China -- and heedless of this meeting.
In this Global Week Ahead, fresher political headlines look to be made "across the pond" in the U.K and Europe.
On Tuesday, a tag-team of U.K. Treasury Secretary George Osborne and Bank of England Head Mark Carney actively seek to capture business news headlines.
The two want to pour cold water on "Brexit." This U.K. referendum to leave the European Union (EU) is scheduled for a vote on June 23rd. U.K. macroeconomic powers-that-be want to make it clear. Voters need to understand the potential bitter consequences of exit from the EU.
On Thursday, Continental Europe hears from ECB head Mario Draghi and Sweden's Riksbank. These two monetary policy groups announce their latest stances on internal negative deposit rates and external zero policy rates. The press conference held by ECB head Mario Draghi is likely the most interesting trading event this week.
On Friday, a European focused week ends with a splash of preliminary PMIs for the Eurozone, and France and Germany specifically. Consensus thinks all composite PMI tallies rise this time around. That is good news indeed for Europe. But any European GDP growth upgrade is still coming off a very low base.
Also on Friday, the EU's Finance Ministers and Central Bankers meet in Amsterdam. In the first half of 2016, the Netherlands holds the Presidency of the EU. That means they host major meetings like this one.
This group of nations will consider 5 options to reduce the exposure of banks to sovereign debt. They don't want a "Doom Loop" to materialize, if the EU heads into another downward spiral.
Note to U.K. voters -- if you are not in the EU, you are not at the table.
Over the weekend -- in a more global setting -- 3 large cap stocks scored notable Zack #1 Rank (Strong Buy) upgrades. Two stocks show us the U.S. still has cyclical companies actively kicking up business. One Japanese stock shows us the global electronic components/semiconductor industry is still experiencing fresh upgrades to its outlook.
Here they are-
Lear Corp (LEA) : This U.S. auto parts stock holds a Zacks VGM trifecta, with an A in Value, Growth, and Momentum. The stock tallies an overall value of A in the VGM context and has a $7.98 billion market cap.
Manpower (MAN) : This U.S. staffing company gets an A for Zacks Value, and a B for Zacks Growth and has a $6.0 billion market cap.
TDK Corp (TTDKY) : This Japanese electronics-miscellaneous components stock gets an A for Zacks Value. The stock tallies an overall A in the VGM context and has a $7.3 billion market cap.
Study Up on the Global Week Ahead for Macro Fundamentals-
On Monday , the NAHB Builders Survey comes out in the U.S. Look for 59, which is slightly better than the prior 58.
The Fed's Kashkari speaks in Minneapolis, MN and the Fed's Rosengren speaks in New Britain, CT.
On Tuesday , a fresh Eurozone ZEW (economic sentiment) index comes out. The market looks for an 8 after a prior 4.3. The ZEW (current conditions) should be 50.8, slightly better than a prior 50.7.
U.S. building permits should be 1.2 million, above the prior 1.167 million mark. Spring is here. U.S. housing starts should be 1.170, about the same as the prior 1.178.
U.K. Finance Minister Osborne speaks before Parliament's Treasury Committee, on three scenarios after the Brexit vote. The BoE's Carney speaks before the House of Lords.
The U.K. Treasury looked at three options (according to the Financial Times ): a negotiated bilateral agreement such as Canada has, to membership of the EEA, to reliance on membership of the World Trade Organization. Under all scenarios, it concludes the UK will be materially worse off outside the European Union.
The Bank of Korea (BoK) announces its interest rate decision.
On Wednesday , the U.K.'s ILO unemployment rate should be unchanged at 5.1%.
Brazil's national unemployment rate could get to 10% from 9.5%.
Brazil's inflation rate is projected at 9.35%, down from 9.95%, but still too high.
On Thursday , the ECB is looking at a deposit rate of -0.4% and a refi rate of 0%. ECB President Draghi will give a press conference following the latest interest rate announcements.
Sweden's Riksbank (an early mover on negative rates) will also announce its latest interest rate decision.
U.S. initial claims should be extremely low at 265K. The latest U.S. leading indicator should go up +0.4, larger than a prior bump of a +0.1 m/m rate.
U.K. retail sales (ex Auto-Fuel) should show a rise of +3.8% y/y, a little worse than the prior +4.1% y/y reading. This is no cause for concern.
France's INSEE manufacturing confidence index should be solid at 101, the same reading as before.
On Friday, the Eurozone is looking for more improvement in expansion to manufacturing and services.
The preliminary composite PMI should be 51.9, better than a prior 51.6. On services, the Eurozone PMI should be 53.3, better than a prior 53.1
- The French preliminary manufacturing PMI should be 49.9, better than the prior 49.6 reading. Services should be 50, better than a prior 49.9.
- The German preliminary manufacturing PMI should be 51, better than a prior 50.7, while services should stay red hot at 55.1, the same reading as before.
Across the pond, the flash manufacturing PMI for the USA should be 52, up from a prior 51.5.
Brazil's proxy GDP should be -5.1% y/y, better than a prior -8.1% y/y reading, but still lousy.
EU Finance Ministers and Central Bankers meet in Amsterdam.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
LEAR CORPORATN (LEA): Free Stock Analysis Report
MANPOWER INC WI (MAN): Free Stock Analysis Report
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
