Thursday, June 24, 2010

Catalysts to Watch (G20 leadership summit is this weekend) financial regulatory reconciliation process is expected to wrap up by Thurs night $GS $SPX

Catalysts to Watch
· the G20 leadership summit is this weekend and while there will be a lot of discussion
around bank taxes, capital, etc, there prob. won’t be any actual specific announcements (see
bigger preview in Action Calendar)
· financial regulatory reconciliation process is expected to wrap up by Thurs night.
· Russell rebalance Fri
· the next two weeks will be very quiet on the US corporate front as we gear up for the start
of Q2 earnings on Mon Jul 12 (AA comes after the close on that day). There are a few more
May-end releases to watch (MU Mon, GIS on Tues, MON on Wed, and STZ on Thurs), but
investor focus is increasingly shifting to the Q2 reports. Vacations will uptick in the coming
two weeks given the dearth of major news and the Jul 4 holidays (US markets are closed on
Mon Jul 5). The biggest event of the week will be the June jobs report on Fri Jul 2 (the St is
currently modeling a loss of 88K jobs for June). Investors will also be watching the auto sales
reports for June on Thurs Jul 1. This weekend, the G20 leaders summit will take place in
Toronto, although no major news is expected to come of this event. The China yuan
announcement last Sat appears to have taken the FX issue off the table while it doesn’t seem
like the major countries have come to an agreement around bank taxation and/or regulations.
The US will press Germany to not pursue fiscal austerity measures too quickly, although
Germany has fought back hard against criticisms and hasn’t indicated any willingness to let
up on its budget cuts. There will be two important confirmation hearings in the Senate
(Kagan for Supreme Court starting Mon and Petraeus starting Tues). In China, we will get
the June PMIs (June 30). In Europe, the Spanish "cajas" banks are supposed to have their
consolidation plan wrapped up by June 30, although the really big news from EU banks won't
come until mid-Jul (when the stress tests get published).

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