Welcome to “The Week Ahead” where we take a moment to provide our thoughts on what we can expect in markets and the economy during the upcoming week.
Lost in the latest trade war chatter (Canada, Mexico, and EU this time) was that Friday’s employment report was solid once again. The unemployment rate is now at an 18-year low at 3.8%. The underutilization rate (also known as “U-6”) – which takes the unemployment rate and then includes those discouraged job seekers who have given up looking for work, people who have gone back to school or have become disabled, and those that are underemployed (those who have to settle for part-time jobs although they prefer full-time jobs) – decreased to 7.60%. The last time the U-6 was this low? May 2001. Random flashback factoid, 2001 was the year America Online and Time Warner merged to become AOL Time Warner (anyone else miss hearing “you’ve got mail”?). Wage growth also beat expectations as it grew 0.3% in May to a year-over-year rate of 2.7%. With this data point, it is hard to see the FOMC not hiking at June’s meeting in two weeks.
The week ahead will be relatively quiet as investors will be monitoring the ISM non-manufacturing index to see if it can reverse course after three consecutive months of declines. The NBA Finals heads to Cleveland as the Warriors hold serve and lead the Cavaliers 2-0!
Data deck for June 2 – June 8:
|
Date |
Indicator |
Period |
|
June 4 |
Durable Goods Orders |
April |
|
June 4 |
Factory Orders |
April |
|
June 5 |
JOLTS Job Openings |
April |
|
June 5 |
ISM Non-Manufacturing |
May |
|
June 6 |
Trade Balance |
April |
|
June 6 |
Nonfarm Productivity |
1Q18 |
|
June 7 |
Initial Jobless Claims |
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|
June 7 |
Consumer Credit |
April |
|
June 8 |
Wholesale Inventories |
April |