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To start this Global Week Ahead, look back over your trading shoulder. Behold the macroeconomic progress in advanced-economy G7 lands.
It has been a full 10 years since the onset of the global financial crisis. These sovereign drivers of the world economy are showing clear signs of improved straights. But even now, their progress remains halting.
Yes, the United States unemployment rate sits at its lowest in a decade. But hourly pay grows slowly. Recent GDP growth data was weaker than expected. Yes, in Europe and Japan, GDP growth has picked up. This has prompted the European Central Bank and the Bank of Japan to talk about eventually easing their huge quantitative easing (QE) stimulus programs.
Yet in Europe, Greece's debt crisis lingers. On Monday, the rest of the Eurozone might clear the way for more relief again, at a meeting of finance ministers.
Now, turn to the present circumstance of our global politics.
During the Global Week Ahead, pity the 10,000 residents of Taormina, Sicily. This small Sicilian city is being turned into a virtual fortress.
Next weekend, the historic city and beach resort on the Mediterranean island will host the G7 leaders from the U.S., Japan, Canada, France, Germany, the U.K. and Italy. During their summit, there will be 10,000 residents -- and 10,000 police, security and military.
Normally in late May, the 80 hotels in Taormina have 5,000 tourists. That can’t happen. These hotels don’t know how they are going to be compensated for this loss, if at all,
Taormina will indeed be under the microscope. New U.S. President Donald Trump has made this G7 summit the last stop on his first overseas trip. He will be joined by other three other G7 opening acts: French President Emmanuel Macron, U.K. Prime Minister Theresa May and Italian Prime Minister Paulo Gentiloni.
Four new G7 leaders ease into their posts – out of 7 possible G7 posts. That shows you the amount of political turmoil the advanced countries experienced last year was indeed significant.
Want to know what debate is happening inside their local news? It is about where Trump sleeps--
There are reports Trump will be staying on an aircraft carrier anchored in the Strait of Messina between Sicily and Italy,
Other Italian media reports say he’ll be helicoptered to sleep at Sigonella Naval Base, a U.S. facility on the island in nearby Catania.
Or he may indeed sleep inside what is called ‘the red zone,’ where the summit happens.
In global news feeds, here are the most pressing macro questions for the G7.
How far will Trump go to remove the world's biggest economy from trade deals? Will he speak about watering down global banking rules?
Will he pump up the U.S. dollar -- by turbo-charging the U.S. economy?
However, traders, keep a keen eye on Wednesday, stateside!
U.S. domestic political happenings can easily overshadow the G7 summit. Former FBI Director James Comey has been invited to testify by House Oversight Committee Chairman Jason Chaffetz. This testimony happens on the same day the FBI is to provide requested documents regarding Comey–Trump communications
Alexis de Toqueville wrote,
“History is a gallery of pictures in which there are few originals and many copies…
…The surface of American society is covered with a layer of democratic paint, but from time to time, one can see the old aristocratic colors breaking through.”
Top Zacks #1 Rank (STRONG BUY) Stock Picks—
(1) Alphabet (GOOGL - Free Report) : This major FANG stock (it is the G) is now a $660 billion market cap company. The long-term Zacks VGM score is C, with a D in Value. That shows you traders are betting on even more growth to come.
(2) JD.com (JD - Free Report) : Have you heard of the great commercial success of internet giant Alibaba in Mainland China? This is their big competitor. The stock has a $58 billion market capitalization. The Zacks VGM score is a tasty B. When do Chinese stocks start purring again? That is a good question.
(3) CSX Corp. (CSX - Free Report) : The Dow Transports are a first mover, indicating more U.S. GDP growth. The appearance of this big $46 billion market cap railroad stock on our top list of hot stocks bodes well for a turn up in growth more broadly. The long-term Zacks VGM score is B.
Key Global Macro—
This week, five Fed officials speak — four speak on Monday. The officials will add fresh insight to the latest Fed minutes, released this Wednesday.
The big question: Will the speakers lean to less than 3 Fed rate hikes this year?
On Tuesday, preliminary Eurozone PMIs come out. They should be strong again.
On Thursday, oil traders will focus on Vienna, Austria. The Organization of Petroleum Exporting Countries (OPEC) meets. They are to discuss extending production cuts.
On Monday, Mexico’s proxy GDP growth rate comes out. Forecasts look for +4.5% y/y. However, for GDP in not seasonally adjusted terms, it looks to be 2.8% y/y.
The unemployment rate in Russia is 5.4%. That’s pretty low. That nation’s retail sales are growing 7.9% y/y. That sounds pretty strong.
The Fed’s Brainerd, Harker and Kashkari speak in the USA. The Fed’s Evans speaks in Shanghai.
On Tuesday, Germany’s important IFO indices come out. Business Climate should go from 112.9 to113.5; Current Conditions should go from 121.1 to 121; Expectations should go from 105.2 to 106.0. All in, more building strength in Europe’s strongest economy.
The preliminary Eurozone manufacturing and services Purchasing Manager Indexes (PMIs) come out. Services should go up from 56.7 to 57 and manufacturing should go up from 56.4 to 56.8.
In comparison, the preliminary USA manufacturing PMI should be around 52.8. U.S. new home sales come out. April was 621K. May should be 585K.
On Wednesday, the unemployment rate in Finland is 9.6%. While in Norway, it is 4.3%. Go figure.
Spain’s Producer Price Index (PPI) comes out. The prior reading was a strong +6.0% y/y.
Sweden’s central bank (the Riksbank) issues its Financial Stability Report.
Mexico’s bi-weekly core Consumer Price Index (CPI) is hot. It is going from +6.01% to +6.15% y/y.
The Bank of Canada should leave it policy overnight rate at 0.50%.
U.S. existing home sales come out. 5.68 million is the target.
The latest U.S. Fed minutes come out.
On Thursday, the unemployment rate in Poland should be 8.1%.
U.S. initial claims for unemployment should remain strikingly low at 232K.
On Friday, the Fed’s Bullard speaks in Tokyo.
U.S. durable goods orders come out. Ex-transport they could rise +0.7% m/m.
The unemployment rate in Mexico is 3.3% in not seasonally adjusted terms, and 3.6% in seasonally adjusted terms. Recall, there is lots of seasonal farming in Mexico.
The G7 summit happens in Taormina, Sicily.
Note: This is one of Sicily’s most popular summer destinations. Taormina is a hilltop town on the east coast of Sicily. It sits near Mount Etna, an active volcano with trails leading to the summit. The town is known for the Teatro Antico di Taormina, an ancient Greco-Roman theater still used today.
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Ten Years Later: Global Week Ahead
To start this Global Week Ahead, look back over your trading shoulder. Behold the macroeconomic progress in advanced-economy G7 lands.
It has been a full 10 years since the onset of the global financial crisis.
These sovereign drivers of the world economy are showing clear signs of improved straights. But even now, their progress remains halting.
Yes, the United States unemployment rate sits at its lowest in a decade. But hourly pay grows slowly. Recent GDP growth data was weaker than expected.
Yes, in Europe and Japan, GDP growth has picked up. This has prompted the European Central Bank and the Bank of Japan to talk about eventually easing their huge quantitative easing (QE) stimulus programs.
Yet in Europe, Greece's debt crisis lingers. On Monday, the rest of the Eurozone might clear the way for more relief again, at a meeting of finance ministers.
Now, turn to the present circumstance of our global politics.
During the Global Week Ahead, pity the 10,000 residents of Taormina, Sicily. This small Sicilian city is being turned into a virtual fortress.
Next weekend, the historic city and beach resort on the Mediterranean island will host the G7 leaders from the U.S., Japan, Canada, France, Germany, the U.K. and Italy. During their summit, there will be 10,000 residents -- and 10,000 police, security and military.
Normally in late May, the 80 hotels in Taormina have 5,000 tourists. That can’t happen. These hotels don’t know how they are going to be compensated for this loss, if at all,
Taormina will indeed be under the microscope. New U.S. President Donald Trump has made this G7 summit the last stop on his first overseas trip.
He will be joined by other three other G7 opening acts: French President Emmanuel Macron, U.K. Prime Minister Theresa May and Italian Prime Minister Paulo Gentiloni.
Four new G7 leaders ease into their posts – out of 7 possible G7 posts. That shows you the amount of political turmoil the advanced countries experienced last year was indeed significant.
Want to know what debate is happening inside their local news? It is about where Trump sleeps--
In global news feeds, here are the most pressing macro questions for the G7.
However, traders, keep a keen eye on Wednesday, stateside!
U.S. domestic political happenings can easily overshadow the G7 summit.
Former FBI Director James Comey has been invited to testify by House Oversight Committee Chairman Jason Chaffetz. This testimony happens on the same day the FBI is to provide requested documents regarding Comey–Trump communications
Alexis de Toqueville wrote,
“History is a gallery of pictures in which there are few originals and many copies…
…The surface of American society is covered with a layer of democratic paint, but from time to time, one can see the old aristocratic colors breaking through.”
Top Zacks #1 Rank (STRONG BUY) Stock Picks—
(1) Alphabet (GOOGL - Free Report) : This major FANG stock (it is the G) is now a $660 billion market cap company. The long-term Zacks VGM score is C, with a D in Value. That shows you traders are betting on even more growth to come.
(2) JD.com (JD - Free Report) : Have you heard of the great commercial success of internet giant Alibaba in Mainland China? This is their big competitor. The stock has a $58 billion market capitalization. The Zacks VGM score is a tasty B. When do Chinese stocks start purring again? That is a good question.
(3) CSX Corp. (CSX - Free Report) : The Dow Transports are a first mover, indicating more U.S. GDP growth. The appearance of this big $46 billion market cap railroad stock on our top list of hot stocks bodes well for a turn up in growth more broadly. The long-term Zacks VGM score is B.
Key Global Macro—
This week, five Fed officials speak — four speak on Monday. The officials will add fresh insight to the latest Fed minutes, released this Wednesday.
The big question: Will the speakers lean to less than 3 Fed rate hikes this year?
On Tuesday, preliminary Eurozone PMIs come out. They should be strong again.
On Thursday, oil traders will focus on Vienna, Austria. The Organization of Petroleum Exporting Countries (OPEC) meets. They are to discuss extending production cuts.
On Monday, Mexico’s proxy GDP growth rate comes out. Forecasts look for +4.5% y/y. However, for GDP in not seasonally adjusted terms, it looks to be 2.8% y/y.
The unemployment rate in Russia is 5.4%. That’s pretty low. That nation’s retail sales are growing 7.9% y/y. That sounds pretty strong.
The Fed’s Brainerd, Harker and Kashkari speak in the USA. The Fed’s Evans speaks in Shanghai.
On Tuesday, Germany’s important IFO indices come out. Business Climate should go from 112.9 to113.5; Current Conditions should go from 121.1 to 121; Expectations should go from 105.2 to 106.0. All in, more building strength in Europe’s strongest economy.
The preliminary Eurozone manufacturing and services Purchasing Manager Indexes (PMIs) come out. Services should go up from 56.7 to 57 and manufacturing should go up from 56.4 to 56.8.
In comparison, the preliminary USA manufacturing PMI should be around 52.8.
U.S. new home sales come out. April was 621K. May should be 585K.
On Wednesday, the unemployment rate in Finland is 9.6%. While in Norway, it is 4.3%. Go figure.
Spain’s Producer Price Index (PPI) comes out. The prior reading was a strong +6.0% y/y.
Sweden’s central bank (the Riksbank) issues its Financial Stability Report.
Mexico’s bi-weekly core Consumer Price Index (CPI) is hot. It is going from +6.01% to +6.15% y/y.
The Bank of Canada should leave it policy overnight rate at 0.50%.
U.S. existing home sales come out. 5.68 million is the target.
The latest U.S. Fed minutes come out.
On Thursday, the unemployment rate in Poland should be 8.1%.
U.S. initial claims for unemployment should remain strikingly low at 232K.
On Friday, the Fed’s Bullard speaks in Tokyo.
U.S. durable goods orders come out. Ex-transport they could rise +0.7% m/m.
The unemployment rate in Mexico is 3.3% in not seasonally adjusted terms, and 3.6% in seasonally adjusted terms. Recall, there is lots of seasonal farming in Mexico.
The G7 summit happens in Taormina, Sicily.
Note: This is one of Sicily’s most popular summer destinations. Taormina is a hilltop town on the east coast of Sicily. It sits near Mount Etna, an active volcano with trails leading to the summit. The town is known for the Teatro Antico di Taormina, an ancient Greco-Roman theater still used today.