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Wall Street looks poised to kick off the new week and quarter on an optimistic note ahead of Friday’s critical payrolls report. Meta Platforms may face EU charges, and Boeing has completed its acquisition of Spirit Aerospace.
1. Futures slightly up ahead of key payrolls release U.S. stock futures inched higher on Monday as the market began a holiday-shortened week, culminating in Friday’s highly anticipated nonfarm payrolls report.
By 04:20 ET (08:20 GMT), Dow futures were up 50 points, or 0.1%, S&P 500 futures gained 11 points, or 0.2%, and Nasdaq 100 futures rose 62 points, or 0.3%.
Wall Street closed a mixed quarter, with the S&P 500 and Nasdaq Composite advancing 3.9% and 8.3%, respectively, driven by continued enthusiasm for artificial intelligence, while the Dow Jones Industrial Average fell by 1.7%.
The Nasdaq achieved its third consecutive positive quarter, a streak last seen ending in 2021.
Investors will closely watch Friday’s nonfarm payrolls report for new signals on when the Federal Reserve might begin to reduce interest rates.
Additionally, Fed Chair Jerome Powell will speak at the European Central Bank’s annual forum in Sintra, Portugal, on Tuesday. The minutes from the Fed’s June meeting, released on Wednesday, will be scrutinized for insights into the central bank’s economic outlook and monetary policy considerations.
2. EU to charge Meta Platforms – FT The European Union is preparing to charge Meta Platforms (NASDAQ
) with violating the bloc’s digital regulations, according to a report by the Financial Times published Monday.
The newspaper reported that regulators are concerned about Meta’s “pay or consent” model, highlighting that this setup presents a false choice, as the financial barrier effectively forces users to consent to their personal data being tracked for advertising purposes.
The EU’s Digital Markets Act aims to curb the power of ‘Big Tech’ firms and create a level playing field for smaller competitors. Last week, the region’s regulators charged Apple (NASDAQ
) with violating the bloc’s tech regulations.
3. Boeing to buy Spirit AeroSystems, finally…
Boeing (NYSE
) announced on Monday that it will acquire Spirit AeroSystems (NYSE
) in a $4.7 billion all-stock deal. This agreement comes after months of negotiations, complicated by Spirit’s dealings with Boeing’s main rival, Airbus.
Boeing’s decision to regain control of Spirit is driven by a need to address the quality issues that have troubled the supplier in recent years.
The total value of the deal, including debt, is approximately $8.3 billion. This follows Boeing’s strategy to repurchase its former subsidiary, which had diversified into supplying Airbus (EPA
) and other companies since becoming independent nearly two decades ago.
Airbus announced it would receive $559 million in compensation from Spirit and will assume core activities at four of Spirit’s plants in the United States, Northern Ireland, France, and Morocco.
Spirit also plans to divest its businesses and operations in Scotland and Malaysia that support Airbus programs. Additionally, it intends to sell operations in Belfast, Northern Ireland, that do not support Airbus programs.
4. National Rally prevails in French elections
France’s far-right National Rally party and its allies secured 33% of the national popular vote in the first round of parliamentary elections, according to the interior ministry’s announcement following Sunday’s vote.
The left-wing New Popular Front came in second with 28%, while President Emmanuel Macron’s centrist bloc garnered 20%.
This result caused the euro to bounce, with the single currency reaching a two-week high, while the CAC 40, the French benchmark equity index, traded higher, recovering from losses of around 6% since French President Emmanuel Macron dissolved parliament.
At 04:20 ET (08:20 GMT), EUR/USD traded 0.4% higher at 1.0758, while the CAC 40 rose by 1.9%.
Investors have been concerned that both the far-right and the left-wing alliance have pledged significant spending increases at a time when France’s high budget deficit has prompted the EU to recommend disciplinary measures.
However, this outcome was better than feared, but it suggests more volatility this week ahead of next Sunday’s runoff, with the final result likely depending on alliance-building efforts.
5. China’s private PMI boosts crude prices
The Chinese economy showed signs of growth in June, boosting crude prices on Monday amid hopes that the world’s largest importer will benefit from the solid momentum in the global economy.
China’s Caixin/S&P Global manufacturing purchasing managers’ index (PMI), a private survey, rose to 51.8 in June from 51.7 in May, indicating the fastest growth in more than three years and staying above the break-even line of 50.0 that separates growth from contraction.
This positive result has boosted sentiment, offsetting concerns from official PMI data released on Sunday that showed China’s manufacturing activity declined for a second month in June, and services activity dropped to a five-month low.
By 08:20 ET, U.S. crude futures (WTI) traded 0.9% higher at $82.27 a barrel, while the Brent contract climbed 0.8% to $85.70 per barrel.
Both contracts gained around 6% in June after the Organization of the Petroleum Exporting Countries and their allies, known as OPEC+, extended most of their significant oil output cuts well into 2025.