Geopolitics aren’t having much of an effect on markets, at least so far, and concerns that Israel and the Iran-backed Lebanese group Hezbollah could be sucked into a full-scale war have done little to move oil prices, let alone broader markets.
Monday’s main potentially market-moving event is the U.S. Treasury’s quarterly refunding announcement.
It’s one of those that can sometimes pass without notice. But investors were surprised by the larger auction sizes in the equivalent announcement a year ago, which sent long-dated Treasury yields higher due to fears about how the additional supply would be absorbed.
We might get through this one unscathed, as the Treasury indicated in May it will keep most auction sizes steady. But it does mean a surprise could generate a larger reaction, and certainly investors remain worried about the U.S. fiscal trajectory.
We’ll rattle through the rest of the week’s big events quickly so we aren’t here all day, as there are a lot of them.
Earnings are due from Microsoft on Tuesday, Meta on Wednesday and Apple and Amazon on Thursday, which will be interesting after Tesla, and to a lesser extent Alphabet, which disappointed last week.
In central banks, the Federal Reserve meets on Wednesday – no change is expected, but it’ll be interesting to see whether they do anything to disrupt market bets on a September rate cut – as well as the Bank of Japan, while the Bank of England will convene on Thursday.
