While they are not entirely comfortable with a monetary path that will necessarily reduce the liquidity available, investors know that this is the right policy. They just hope, and so does the U.S. central bank, that things will not have to be rushed.

In the absence of corporate financial results, since the big players will start publishing their half-year performances from mid-July onwards, it is the macroeconomy that will again set the tone this week. First of all, there will be several speeches from central bank officials. These always abound at the beginning of summer, due to various economic events organized around the world. "Economies are getting better and the inflation spike is temporary" will still be the dominant speech. But the hawks, the hardcore fringe of the profession, will make their voices heard in favor of faster monetary normalization. In the US, it is the comments of Bullard, Bostic and Rosengren, three of the Fed's members, who regularly mention a first rate hike as early as 2022.

Beyond the omnipresence of Powell, Lagarde and their peers, two important events are scheduled in the coming days. An Opec+ meeting on Thursday for starters. The cartel has regained control of prices and should allow, according to specialists, a further moderate acceleration of production, to accompany demand. At a time of major antitrust fights, this meeting seems incongruous. But this does not prevent it from continuing to exert a decisive power, which has been less upset recently by the shale industry in the United States.

The last point to watch is US employment. The monthly statistics for June will be published on Friday. Economists believe that the figures will be solid, with a more marked improvement than in the spring, particularly because aid programs have recently ended. The Wall Street Journal noted this weekend that jobless claims have fallen faster in states that have already ended their safety net programs. But let’s remain careful, as there is a perception gap between what is good for the economy and what is good for finance. Very positive data would lead to fears that the Fed's monetary normalization process would accelerate. Conversely, if the employment data is less favorable than expected, investors may see it as a sign that the central bank could keep the liquidity valves open longer. The interests of the various parties are not always convergent, even if a robust economy that benefits the majority of the population seems eminently healthier than an economy on life support.

 

Economic highlights of the day

There will be no major macroeconomic indicators today.

The dollar/euro pair was little changed at EUR 0.8390. The gold ounce is holding in the USD 1775 area. Oil is losing some ground at USD 76 per barrel for Brent and USD 73.95 per barrel for WTI. The yield on US debt is rising slightly to 1.53% on 10-year. Bitcoin is trading around 34,200 USD.

 

On markets:

* United Airlines is close to completing an order worth about $30 billion that could include up to 200 BOEING 737 MAX and 70 AIRBUS A321neo aircraft, several industry sources said. The company also said it expects an adjusted taxable profit in July, which would be the first since January 2020, as bookings resume.

* The Boeing Company - The U.S. Aviation Safety Agency (FAA) informed the aerospace and defense giant that it will not "realistically" certify the 777X, a stretched version of the 777, until mid- to late 2023.

* Johnson & Johnson - The U.S. pharmaceutical company announced Saturday that it has agreed to pay $263 million to end a lawsuit accusing it of fueling an opioid epidemic in New York state and two of its counties.

* Tesla - Chinese regulators said Saturday that Tesla will recall nearly 300,000 Model 3 and Model Y cars made and imported into China for a software update related to assisted driving, with owners not required to return their vehicles.

* The U.S. Food and Drug Administration (FDA) on Friday added a warning to the literature accompanying COVID-19 vaccines developed by Pfizer-BioNTech and Moderna to indicate the rare risk of heart inflammation after their use.

* Dutch insurer NN Group announced Sunday that it had made an offer to buy some of MetLife's European businesses, though it did not say which ones or disclose the amount of its offer.

* A U.S. House of Representatives committee on Friday announced an investigation into the approval and pricing of Biogen's Alzheimer's drug Aduhelm amid concerns about its high price and clinical evidence of effectiveness.

* Microsoft announced Friday that a hacker used information obtained through a customer advisor to attempt to launch new attacks.

 

Analyst recommendations:

  • Accenture : JPMorgan raises pt to $308 from $283, maintains overweight rating
  • BlackBerry : Canaccord Genuity issues sell rating, keeps pt at USD 10
  • Darden Restaurants : Goldman Sachs adjusts pt to $163 from $162, maintains buy rating
  • eBay : Stifel adjusts price target to $78 from $75, maintains buy rating
  • Entain: AlphaValue upgrades from light to heavyweight, targeting 2015 GBp.
  • First Republic Bank : JPMorgan adjusts pt to $230 from $225, maintains overweight rating
  • Harbour Energy: Berenberg remains Hold with a price target raised from GBp 20 to GBp 390.
  • Huntington Bancshares Incorporated : JPMorgan adjusts pt to $18 from $20, maintains overweight rating
  • Live Oak Bancshares : JPMorgan adjusts pt to $70 from $78, maintains neutral rating
  • M&G PLC: HSBC upgrades its buy rating to hold from buy with a target of GBP 250.  
  • National Grid: RBC keeps Buy rating. The target price has been modified and is now set at GBp 1040 compared to GBp 1020.
  • New York Community Bancorp : JPMorgan adjusts pt to $13 from $14, maintains neutral rating
  • Rite Aid : Evercore ISI adjusts pt to $13 from $14, maintains underperform rating
  • St James's Place: HSBC upgrades its buy rating to hold from buy with a target of GBP 1,525.