Investors will be paying close attention this week to new developments out of the Middle East related to growing tension between 4 Arab Gulf states and Qatar over its support for Iran and radical Islamist groups across the Middle East that carry out terrorism.
Saudi Arabia, Bahrain, Egypt, and United Arab Emirates are severing diplomatic ties with Qatar after they accused the country of intruding in their internal affairs and backing terrorist activities.
Crude oil is trading higher on the new development.
Some of the other political events that could sway the markets this week includes Britain’s upcoming election on Thursday June 8th with polls showing that British Prime Minister Theresa’s May lead is slipping and the Conservative majority could be at risk.
Former FBI Director James Comey will testify as a civilian before a Senate Intelligence Committee on Thursday concerning President Trump’s campaign and Russian contacts in addition to his conversation with President Trump about the FBI investigation of his former national security adviser Michael Flynn concerning his connections with Russia.
Last Friday the U.S. Bureau of Labor Statistics reported that the U.S. economy added 138,000 non-farm payroll jobs in May, below the 185,000 consensus estimate from briefing.com and lower than the average monthly gain of 181,000 over the past 12 months.
The job reports for the months of March and April were also revised lower by 66,000 than previously reported.
The good news was that the U.S. unemployment rate in May reached a 2001 low of 4.3 percent and private payroll processor ADP reported an increase of 253,000 private sector job gains in May, beating the consensus estimate of 180,000 from briefing.com.
The Economic Week Ahead
On Monday U.S. Factory orders for April will be reported. The consensus estimate from briefing.com is for a decline with factory orders of -0.2 percent after a 0.2 percent increase in March.
Some of the other economic data out on Monday includes ISM Services for May and Unit Labor Costs and Productivity- Rev for Q1.
On Tuesday Jolts-Job Openings for April is reported.
On Wednesday Consumer credit for April is due alongside weekly crude inventories and the MBA Mortgage Applications Index.
On Thursday Continuing and Initial claims will come into focus along with natural gas inventories.
On Friday Wholesale inventories for April is released.
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