Weekly Issue Check: Economic Indicators, EU elections, OPEC+ talks

Weekly Issue Check: Economic Indicators, EU elections, OPEC+ talks

*Key economic indicators
In recent financial markets, it is important whether the Fed cuts interest rates or not, but the economic contraction is also affecting them. That is why the results of key economic indicators this week are more important than ever, and the possibility of expanding index volatility cannot be ruled out depending on the results. Note whether the ISM manufacturing index on Monday exceeds the baseline of 50.0 from 49.2. The JOLTs on Tuesday are in high demand with 1.32 jobs per capita, but have been on the decline since the recent downturn. On Wednesday, the ISM services index fell below the baseline of 50 for the second time since the pandemic last month, but it is important whether it will continue this time. The ECB's monetary policy meeting on Thursday expected changes in foreign exchange markets following further cuts in the future after the rate cut. Friday's employment report slowed due to climate factors in April, but this time it is expected to increase. However, the employment participation rate remains low, and job insecurity is likely to continue. In general, U.S. economic indicators are expected to improve from last month's announcement

*EU election
There is also a US election this year, but the importance of this week's EU election is also quite large. In particular, as the gap between the rich and the poor in the Eurozone widened and the economy slowed, extreme far-right parties made strides, taking over the Dutch regime in November of last year. While economic growth and job creation were prioritized in the 2019 election, the fight against poverty and social exclusion, public health, and defense are prioritized in this election. According to recent opinion polls, far-right parties such as ID and ECR have increased from 18% in the past to 25%. Conservative behavior is underway due to Ukraine support and immigration. Market participants are paying attention to the possibility of a trade dispute between the US and the EU may increase if the number of seats for these far-right parties expands.

*OPEC+ Talks
At the OPE+ talks on Sunday (Sunday 2), eight members including Saudi Arabia and Russia agreed to extend production cuts by 2.2 million barrels per day, but the UAE announced a gradual easing of production cuts by 300,000 barrels per day from January to September. U.S. consumers prefer gasoline cars, 34% hybrid cars, and 21% electric cars, but gasoline prices have continued to fall. The decision was expected by OPEC+ countries as the demand could continue to slow down due to concerns over the global economy. Some market watchers say that the latest deal could increase the possibility of a rise in international oil prices due to a drop in supply, but some predict that the rise in international oil prices will be limited due to sluggish demand, which could lead to limited fluctuations

06/03 (Monday)
Korea: Export-Import Statistics (1 day)
Talks: OPEC+ (2nd)
China: Caixin Manufacturing PMI
US: ISM Manufacturing Index, Construction Expenditure
Report: U.S. Car Sales
Performance: GitLab

06/04 (Tuesday)
United States: Jolts
Earnings: CrowdStrike, Hewlett-Packard Entertainment

06/05 (Wed)
China: Caixin Service Index
US: ADP Private Employment Report, ISM Service Index
Meeting: Canadian Monetary Policy Council
Earnings: Lululemon, Dollar Tree, Campbell Soup

06/06 (Thursday)
Eurozone: Retail Sales
Meeting: ECB Monetary Policy Meeting
Elections: EU elections (~9th)
Earnings: Nio, Documentary Sign

0.6/07 (Fri)
China: Import and Export Statistics
United States: Employment Report