Good morning! It’s a huge week ahead – here’s what you need to know…
1. On the global front it’s a four-day week for the US with the July 4th holiday falling on Friday. This means the usual busy first week of the month is squeezed into four days, leading up to the jobs report on Thursday night – meaning the Asian markets will be trading on the data while it’s still hot on Friday morning. This and other data this week, including the Chicago PMI tomorrow, should indicate whether the solid leading indicators of recent weeks really are pointing to the big upswing in the US economy that we’ve been waiting for. Also on Thursday night, there’s the ECB rate decision and Mario Draghi’s accompanying press conference where we’ll get an update on progress in Europe.
2. In Australia and Asia we are also getting a flood of data, including AiG PMI tomorrow, May retail sales on Thursday, and of course the RBA’s decision on interest rates tomorrow. There’s no change in the target cash rate expected but as usual the markets will be watching the governor’s statement closely for any indications on shifts in the board’s thinking on the economy’s progress, especially the continuing strength of the dollar. This morning the battler was trading at US94.24c.
3. The retail sales data for May will be of particular interest in Australia: the month was an exceptionally warm start to the summer, and it was also the month of the spectacular fall in consumer confidence triggered by the federal budget. Several retailers have sounded warnings about the potential impact of the fiscal tightening on their business. A Bloomberg survey of economists late last week found the market expecting a rise of 0.1% for the month. We’ll see on Thursday.
4. To the markets and ASX futures are pointing to a slight rise on the open, after the US markets clawed their way into the black in Friday trade. The Dow was flat, the S&P up 0.2% and the Nasdaq up 0.4%. The big move on Friday was in the Nikkei, which fell almost 1.4% on Friday thanks to a big break in USDJPY triggered by strong May retail trade data and national CPI hitting 3.7%.
5. Tony Abbott’s next policy challenge will be dealing with a huge push from his backbenchers for a change to the Renewable Energy Target, which is currently under a review led by Dick Warburton. The Australian reports this morning that 25 Coalition MPs will write to Abbott urging him to consider dramatic revisions to the scheme which would exempt power-intensive industries. The RET current aims to have 20% of Australia’s power requirements come from solar and wind by 2020.
6. Middle East power struggles. After the “Arab Spring”, we now have “Jihadi Spring”, with Libya devolving into lawlessness, Egypt reverting to dictatorship, and the conflict in Syria spilling into a sectarian civil war in Iraq. The ISIS militants who have been capturing towns across Iraq and carrying out mass executions have now declared the creation of an Islamic State, or Caliphate, with ISIS leader Abu Bakr al-Baghdadi as its leader. It’s a direct challenge to the primacy of al-Qaeda, and ISIS is well-funded. There’s more here.
7. Todd Carney’s NRL career is over. Surely. Please. This prince of football idiots has been released from Cronulla after allowing himself to be photographed “ bubbling” at the urinal in Sutherland Shire nightclub Northies. He had three years to run on his $650,000 a year contract. So what is bubbling? WARNING: The thought alone is scarring enough, but the picture cannot be unseen. (Really, you don’t need to see it.)
8. World Cup update. The Dutch are through to the quarter-finals after beating Mexico 2-1 thanks to a hugely controversial stoppage time penalty. Arjen Robben took a fall in the box after contact with a Mexican defender – he made a bit of a meal of it, but the ref blew the whistle and pointed to the spot. In today’s other game, Costa Rica just beat Greece on penalties.
9. Drones and privacy. Drones are a booming growth sector, with the technology already delivering huge benefits to the military and film-making, and great promise for delivering industrial-scale wireless internet connectivity as well as delivery systems for everything from books to pizzas. But authorities are grappling with the regulatory requirements and here’s a great example of the kinds of issues it raises: a woman in the US who saw a drone hovering outside her apartment while she was getting changed.
10. Memes that make money. They’re the stars of YouTube who, for the most part unwittingly, have a steady flow of income rolling in from eternally rising view counts. Here’s how much money viral stars such as Grumpy Cat, Double Rainbow Guy and Tay Zonday have earned from their brush with fame. Also, Technoviking bonus update.
Have a cracking day. I’m on Twitter: @colgo
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