Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Top 5 Things to Watch in Markets in the Week Ahead

EconomyJul 04, 2021 12:03
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters.

By Noreen Burke -- The week after the U.S. jobs report is usually one of the lightest of the month in terms of economic data and the coming holiday-shortened week will be no exception. Wednesday’s Federal Reserve meeting minutes may give investors an insight into policymakers behind the scenes discussions after a hawkish shift prompted market turbulence last month. The European Central Bank will also publish the minutes of its latest meeting, while China will release what will be closely watched inflation figures. And with markets going into the second half of the year investors are asking whether the stunning first half run can continue. Here is what you need to know to start your week.

  1. Fed minutes

The minutes of the Fed’s June meeting, when officials opened talks on tapering bond-buying and indicated interest rate increases could come sooner than previously anticipated, are due to be released on Wednesday.

The minutes are coming on the heels of Friday’s nonfarm payrolls report, which showed that the U.S. created the most jobs in 10 months in June, indicating that the economy closed out the second quarter with strong momentum as the reopening continued.

The robust data did little to ease concerns that a strong recovery and rising wages could prompt the Fed to begin unwinding its easy money policies sooner than expected.

That dynamic looks set to continue to weigh on markets ahead of the Fed’s July policy meeting and its annual meeting in Jackson Hole, Wyoming, in August.

  1. ISM services data

The ISM index of service industry activity is set to be released on Tuesday and is expected to show continued strong growth after hitting a record high in May amid a reopening made possible by vaccinations against the coronavirus. The report could also underline ongoing labor constraints as hiring continues to lag, leading companies to offer higher wages to attract staff.

This theme will likely be echoed by Wednesday’s JOLT - Job Opening and Labor Turnover - report. It is expected to show a new record for job openings, but that hiring continues to lag far behind given potential workers are either unable or unwilling to take a job.

Investors will also be looking at Thursday’s figures on initial jobless claims. Last week’s report showed that initial claims dropped to the lowest level since March 2020, when widespread lockdowns were enforced to slow the first wave of the pandemic.

  1. Second half

With markets into the second half of 2021, investors are now wondering if the stunning first half run can continue.

Though U.S. stock markets are holding near record highs, some market analysts have pointed to signs of caution in some areas of the market.

Travel and leisure stocks along with value shares have been weighed down by worries over the rapid spread of the COVID-19 Delta variant, while yields on U.S. government bonds have remained subdued amid concerns over a potentially more hawkish Fed.

Some investors in recent weeks have also noted a concentration of the market’s gains in fewer stocks, which some view as a sign of declining confidence in the wider market.

Investors will now shift their focus towards the second-quarter earnings season and progress on President Joe Biden's infrastructure bill which could help the stock market keep up momentum.

  1. ECB minutes

The ECB is to publish the minutes of its June policy meeting on Thursday. ECB-watchers will also be on alert for news of several meetings due to take place in the coming weeks as part of the banks review of its monetary policy strategy.

The bank wants to revamp its inflation target - currently set out close to but not above 2% - and is aiming to get the review done by September.

On Wednesday, euro zone powerhouse German is to publish industrial production figures and the European Commission is to release updated economic forecasts for the European Union.

  1. China inflation

China is to release data on both consumer price inflation and producer price inflation on Friday. Market watchers will be paying close attention to the cost of raw materials, which have soared due to higher commodity prices, and whether these increases are being passed onto the consumer.

Prices are jumping in China and around the world, adding to fears that a wave of inflation could threaten the global economic recovery if it continues.

--Reuters contributed to this report

Top 5 Things to Watch in Markets in the Week Ahead

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email