The Week Ahead on Wall Street

Economic Data

On Monday, the Census Department releases construction spending for June. This measures how much the US spent on construction in the month. For May, spending declined 0.3% amid rising material and labor costs. With inflation still rising and the labor market tight, investors will be paying close attention to the impact these factors had on construction spending in June.

On Tuesday, motor vehicle sales for July are released. The automobile industry sold 15.4 million vehicles in June. While the Fourth of July holiday is a big selling period for car manufacturers, 2021 is proving to be different. With semiconductor shortages and pent-up demand, car companies are having difficulty churning out new vehicles. That is expected to lower sales during what is typically a strong month.

On Wednesday, the Federal Open Market Committee releases the minutes of its meeting and Federal Reserve Chairman Jerome Powell will hold a press conference. Investors will be paying close attention to what the Fed has to say about interest rates in the wake of inflation that is rising at a pace not seen in more than a decade. In a policy statement released last week, the Fed said it remains optimistic about the recovery of the economy despite rising cases of the Delta variant.

On Thursday, initial and existing jobless claims for the week earlier are released by the Labor Department. Unemployment claims had been falling for a while but creeped up again in recent weeks, in part due to businesses worrying about the Delta variant. Last week initial claims decreased by 24,000 to 400,000, which was higher than the 380,000 economists were looking for.

On Friday, consumer spending for June is released. In May the frenzied pace of spending on the part of consumers took a break but higher prices led the index to remain unchanged. With concerns about COVID-19 cases increasing as the Delta variant spreads, investors will be paying close attention to June’s reading to gauge if consumer spending is beginning to slow.

Earnings Reports

On Monday, Global Payments (GPN) reports quarterly earnings. Earlier this month the payment technology and software company announced a new partner program aimed at cultivating strategic alliances with big global companies. PwC is a charter member of the new program. The aim of the alliance is to find new business opportunities, so investors will likely want to hear more about the effort when it reports quarterly earnings.

On Tuesday, be on the lookout for Alibaba Group (BABA) to report quarterly earnings. China’s largest ecommerce company’s share price has been under pressure in recent days as the government in its home country clamps down on tech companies and the education sector. The increased scrutiny and new regulations spooked investors, erasing billions in market value for Alibaba and other leading Chinese tech stocks. Investors will want to hear more about the impact from this increased Chinese regulation when it reports earnings Tuesday.

On Wednesday, CVS Health (CVS) weighs in with its quarterly earnings report. The drugstore operator, which administered the COVID-19 vaccine, has been enjoying brisk business but it also faces competition from online pharmacies. As it stands there are more than a dozen startup companies going after the prescription medicine market, which stands at $465 billion in the US. They are setting their sights on CVS and its traditional drugstore competitors as they try to disrupt the marketplace. Investors will want to know how CVS plans to stave off that newfound competition when it reports quarterly earnings.

Be on the lookout for Moderna (MRNA) to report quarterly earnings Thursday. The drug maker is expected to report strong sales lifted by its COVID-19 vaccine. After all, rival Pfizer (PFE) sold $7.8 billion worth of its pandemic vaccine during the second quarter. The company is currently expanding its vaccine trials of children between the ages of 5 and 11 as it seeks FDA approval. Approval could mean expanded sales, something investors will be paying close attention to.

On Friday, Dominion Energy (D) reports quarterly earnings. The energy company announced earlier this month that it is terminating the planned sale of Questar Pipelines to Berkshire Hathaway due to uncertainty around gaining FTC approval for the deal. As a result the company said it took out a 364-day term loan to pay back the $1.3 billion deal deposit Berkshire Hathaway Energy made. Investors will undoubtedly want to hear more about why the deal was canceled and what it means to the pipeline when Dominion reports earnings Friday.

The Week Ahead at SoFi

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