Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Michigan Index, EU Summit, FedEx Earnings, OPEC+ Meeting - What's Moving Markets

Economy Jun 24, 2022 18:18
Saved. See Saved Items.
This article has already been saved in your Saved Items

By Peter Nurse -- Wall Street heads for a positive close to the week, snapping a three-week negative run, ahead of the release of the widely-watched Michigan consumer sentiment index. EU leaders continue their summit amid economic difficulties, Boris Johnson faces political woes in the U.K., and the crude market looks forward to next week’s OPEC+ meeting. Here's what you need to know in financial markets on Friday, June 24.

1. Investors digest Powell’s comments; Michigan sentiment due

Investors will take this final day of the week to parse through Federal Reserve chairman Jerome Powell’s testimony to Congress, while studying the latest data on the state of the U.S. economy.

Powell made clear the central bank’s commitment to reining in soaring inflation, calling it "unconditional", even acknowledging that the sharply higher interest rates needed to do so may push up unemployment and increase the risks of a recession.

Economic data due Friday includes new home sales for May, at 10:00 AM ET (1400 GMT), which is expected to show a slight slowdown, and the Michigan consumer sentiment index for June.

Analysts expect the June Michigan number to be 50.2, which would be in line with the previous month. Earlier in the day, the German Ifo business sentiment index dropped in May as rising energy prices and the threat of gas shortages unsettled businesses in Europe's largest economy, and U.K. consumer confidence dropped to a record low.

2. EU summit continues

The European Union leaders continue their summit Friday, a day after they took the historic decision to grant Ukraine, as well as Moldova, candidate status on the path to membership of the bloc.

With that potentially thorny issue out of the way, the conversation is likely to turn more towards the economic situation the bloc finds itself in, with inflation soaring and the likelihood of a recession rising.

Comments from Luis de Guindos, Vice-President of the ECB, at 09:30 AM ET (1330 GMT), will be carefully studied after the policymakers at the central bank paved the way for an interest rate hike next month.

A poll by Reuters showed all but two of the 55 economists expected the ECB to deliver a quarter-point raise on July 21 to -0.25%, and 50 of 55 expected it to hike its policy rate by 50 basis points in September, taking the deposit rate out of negative territory to 0.25%.

3. Stocks set to open higher; FedEx Impresses 

U.S. stock markets are set to open higher Friday, set to record a rare positive week during these turbulent times.

By 06:00 AM ET (1000 GMT), Dow Jones futures were up 215 points, or 0.7%, while S&P 500 futures were up 0.8% and Nasdaq 100 futures were up 1%. 

All three cash indices are on course to snap three-week losing streaks, with the blue-chip Dow Jones Industrial Average up 2.6% so far this week, the broad-based S&P 500 3.3% higher and the Nasdaq Composite up 4%.

Stocks likely to be in focus include FedEx (NYSE:FDX), after the transport company, widely regarded as a bellwether of the online shopping and remote economy in general, impressed with its quarterly earnings after the close Thursday. Carnival (NYSE:CCL) will also report its latest quarterly earnings, amid signs summer travel is picking up. 

4. Johnson’s leadership in question after U.K. by-election defeats

The problems facing British Prime Minister Boris Johnson are mounting, with his Conservative Party losing two by-elections overnight as voters turned against his party, including a swing of nearly 30% in a previously safe seat in southeast England.

The results prompted Conservative Party co-chairman Oliver Dowden to resign from the role with immediate effect, stating that "someone must take responsibility", a line which could be seen as a dig at Johnson’s leadership just a few weeks after he survived a vote of no confidence in the wake of the ‘Partygate’ scandal.

Johnson’s political success has been based on his popularity in his party’s heartlands, but these results indicate that may be waning as surging prices, a squeeze on incomes, and disruption from strikes take a toll on the national mood.

Additionally, U.K. retail sales volumes dropped by 0.5% in May, according to data from the Office for National Statistics. The decline was mainly due to slowing food store sales, which fell by 1.6% during the month, a sign that inflation concerns may be taking a bite out of consumer demand.

5. Oil set for weekly fall; OPEC+ meets next week

Crude oil prices rose with risk sentiment on the up Friday, but the market is heading for its first back-to-back weekly loss since early April on fears that aggressive monetary tightening will slow global growth, weighing on demand.

By 06:00 AM ET, U.S. crude futures were up 1.3% at $105.58 a barrel, while Brent crude was up 1.1% at $111.28 a barrel. Both benchmarks are on course for weekly losses of over 2%

Attention will quickly turn to the meeting of the Organization of Petroleum Exporting Countries and allies next week to discuss the group’s production levels.

The cartel, known as OPEC+, is widely expected to stick to its plan to boost output by 648,000 barrels a day in July and by the same amount in August, despite the plans of U.S. President Joe Biden to visit Saudi Arabia, the de facto leader of the group, to plead the case for lower crude prices.

Michigan Index, EU Summit, FedEx Earnings, OPEC+ Meeting - What's Moving Markets

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
Continue with Google
Sign up with Email