Top Things to Watch

S&P 500 and Nasdaq broke new records last week. This market rally was sparked by renewed optimism in AI, especially after Micron’s upbeat forecast and Nvidia regaining its crown as the world’s most valuable company.

If the Nasdaq stays above 20,173.89, it signals the official end of the bear market and the start of a new bull cycle. That’s a technical milestone with psychological power for global investors.

A U.S. economic contraction is still on the radar, which is favoring longer-duration bonds, especially in the U.S., U.K., and Germany.

Europe continues in "recovery mode" for a record 16 months, with big inflows continuing into Industrials and Switzerland (I'll explain to you why in another article).

Don't forget that tariff tensions and upcoming economic data could quickly reshape the market mood, so keep your eyes on the following events:

China Manufacturing Purchasing Managers Index (PMI)

China's manufacturing PMI has already been released and rose to 49.7 (2 points above May's reading). Although a printing below 50 still indicates contraction, for a third consecutive month, the sub-index tracking production rose to 51, and the gauge tracking new orders ticked higher to 50.2, indicating improvement in industrial activity and demand.

Following the release, the CSI 300 index saw a slight gain, and analysts foresee some economic momentum, although investors remain cautious due to weaker export growth and fading fiscal support.

U.K. Gross Domestic Product (GDP) YoY - Q1

This release is expected to show a 0.7% increase compared to the previous quarter, an unrevised number from the first estimate.

Please note that while the UK economy saw positive growth in Q1 2025, the monthly data for April shows a contraction, particularly in the services sector, and the impact of external factors like the tariffs menace is starting to affect some businesses. 

Eurozone Consumer Price Index (CPI) YoY

This CPI report comes after a short-lived June oil price jump following Israel's attacks on Iran.

Headline inflation is forecast to have increased by 2% on June 2024 levels, up from May’s 1.9%. Core inflation, excluding volatile energy and food prices, is expected to have risen 2.3% YoY.

The European Central Bank’s (ECB) next policy meeting is on July 24, with no meetings in August. Markets expect an interest rate cut only in September, but, as such a decision is data-dependent, higher energy price volatility could delay the rate cut.

U.S. ISM Manufacturing Purchasing Managers Index (PMI)

The Institute of Supply Management (ISM) Manufacturing PMI is expected to show continued contraction in the manufacturing sector, with a reading below 50, but possibly slightly higher than the previous month.

Analysts are forecasting a slight increase to 48.8, suggesting a gradual recovery, in a setting of weak domestic demand. 

U.S. ISM Manufacturing Prices

The U.S. ISM Manufacturing Prices index measures the change in prices of raw materials and other inputs used by manufacturers.

If June 2025 reading comes as expected, Powell's argument on inflationary pressure will be confirmed.

U.S. JOLTS Job Openings - May

In the previous reading, U.S. JOLTS (Job Openings and Labor Turnover Survey) job openings unexpectedly grew, indicating a continued strength in the labor market.

The JOLTS report is a crucial indicator of labor market health, providing insights into the supply and demand for workers. It's a key factor influencing economic growth and policy decisions by the Federal Reserve (Fed). 

While the job market is still strong, hiring is slowing, with businesses becoming more cautious. A lower-than-expected report could signal economic weakness, potentially impacting the dollar and causing stock market volatility, though bonds might see gains as investors seek safety.

U.S. Crude Oil Inventories

U.S. crude oil and fuel inventories fell last week as refining activity and demand rose.

There's still no forecast for this week report, but as gasoline demand is moving upward, a substantial drawdown in stocks can give the market a chance to stabilize after the most recent geopolitical turbulence involving Iran.

U.S. Nonfarm Payrolls - June

The NFP is closely watched by investors, economists, and policymakers worldwide.

This report details the change in total number of paid workers in the U.S. excluding farm employees, private household employees, and non-profit employees. A strong NFP report typically indicates a robust economy, while a weak report can signal potential economic weakness. 

The June 2025 NFP report, scheduled for release on Friday, is expected to show a continued cooling trend in the labor market.

A weaker-than-expected June NFP report could cause initial stock market declines due to economic growth concernsand potential delays in interest rate cuts. However, if the data also points to lower inflation, it might later boost stocks by signaling future rate cuts. The overall market reaction will depend on other economic data and prevailing investor sentiment.

U.S. Services Purchasing Managers Index (PMI) - June

The US Services PMI for June 2025, is likely to influence market sentiment, particularly regarding the US dollar and potentially other assets. A reading above 50 indicates expansion in the services sector, while a reading below 50 suggests contraction. Several financial news outlets report that the Services PMI is expected to edge lower to 53.1, a slight decrease from May's 53.7. This indicates continued growth in the service sector, but at a slightly slower pace.

U.S. ISM Non-Manufacturing Prices - June

The market's reaction to the June 2025 U.S. ISM Non-Manufacturing Prices will depend on whether the reading is above or below expectations and recent trends,. A higher-than-expected reading, indicating increased prices, could be perceived as inflationary, potentially leading to a stronger USD and upward pressure on interest rates as the Fed might consider tighter monetary policy. Conversely, a lower-than-expected reading, suggesting slowing price increases, could weaken the USD and potentially boost stock prices as it might signal less aggressive interest rate hikes.