As the second half of 2024 commences, investors are gearing up for a holiday shortened week. The week could be eventful, with the anticipation building towards Friday’s release of the June jobs report, which is expected to provide significant insights into the current state of the labor market. Preceding this, the S&P PMI manufacturing and ISM manufacturing data for June will be disclosed on Monday. Additionally, May’s construction spending figures are also slated for release, potentially impacting market movements.

Europe’s Stoxx 600 index experienced a modest recovery, climbing 0.45% by mid-morning and breaking a streak of four consecutive losses. This uptick was largely fueled by a surge in France’s CAC 40 index, which saw an initial spike of over 2.5%, later stabilizing to a 1.3% increase.

China’s (PMI) for manufacturing held steady at 49.5 over the weekend, mirroring the figure from May and signaling a continuation in the sector’s contraction for the second consecutive month. Meanwhile, Japan’s economic outlook has been adjusted to reflect a deeper downturn than initially reported. The country’s Gross Domestic Product (GDP) for the first quarter was revised downward, showing a contraction of 2.9% year-on-year.

Economic Calendar

Earnings Calendar

There are no notable reports on this Monday.

News & Technicals’

Google is set to make a significant leap in renewable energy investment by partnering with BlackRock to develop a 1 gigawatt solar capacity pipeline in Taiwan. This initiative, announced on Monday, is part of Google’s broader strategy to enhance energy capacity and reduce carbon emissions, particularly in light of the growing demands of the artificial intelligence industry. The collaboration involves a capital investment in Taiwanese solar developer New Green Power, pending regulatory approval, which aims to expedite the construction of a substantial solar infrastructure. A segment of this new solar capacity is designated to supply power to Google’s data centers and cloud region within Taiwan, aligning with the company’s commitment to sustainable operations and its goal of achieving net-zero emissions by 2030. This move not only underscores Google’s dedication to environmental stewardship but also reflects the tech giant’s recognition of the critical role that green energy plays in supporting the technological advancements of the future.

In a strategic move to consolidate its manufacturing process and address ongoing safety concerns, Boeing has announced its intention to acquire fuselage manufacturer Spirit AeroSystems. This decision follows a significant leadership overhaul at Boeing, which was prompted by a serious incident where a door panel detached midflight from a nearly new Boeing 737 Max 9 jet. The acquisition, valued at approximately $4.7 billion, is seen as a step towards improving the quality and safety of Boeing’s aircraft, as both companies have faced challenges in eliminating manufacturing defects on the 737 Max, Boeing’s best-selling aircraft.

Meta, the parent company of Facebook, has come under scrutiny from European Union regulators. On Monday, it was accused of not adhering to the EU’s stringent antitrust regulations concerning its new ad-supported social networking service. This accusation marks a significant challenge for Meta, as it navigates the complex regulatory environment of the EU. The bloc’s antitrust rules are designed to ensure fair competition and prevent any single company from dominating the market to the detriment of consumers and competitors. Meta’s alleged non-compliance could have serious implications, including the possibility of hefty fines and mandatory changes to its business practices. The situation underscores the increasing tension between large tech companies and regulatory bodies, as governments seek to rein in the influence of these digital giants.

As the premarket bulls try to shake off Friday’s whipsaw to kick-off this holiday shortened week, we should expect volume to decline with the early close on Wednesday.  However, expect bursts of price volatility with a Powell speech, FOMC minutes and of course the Friday employment situation report.

Trade Wisely,

Doug