Week Ahead on Wall Street: Evolving Geopolitics

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Week Ahead on Wall Street

This week, financial markets are in a precarious situation, with a fast-moving geopolitical shock threatening to overshadow the latest economic data releases. 

The direct military conflict that erupted between Israel and Iran on June 13 shattered a period of improving economic sentiment, triggering a classic flight to safety. The immediate market reaction saw crude oil prices spike and stocks sell off, as investors favored traditional safe haven assets like gold and government bonds.   

The conflict marks a serious escalation from a years-long shadow war to overt, state-on-state hostilities, with both sides exchanging missile and drone attacks targeting military, nuclear, and energy infrastructure. 

The primary risk for the global economy is a broadening of the conflict and disruption to energy supplies, particularly through the Strait of Hormuz, a critical channel for about a quarter of the world’s daily oil supply. 

While a full blockade would be a very bad scenario, the present conflict has already added a significant risk premium to energy prices, which could fuel an inflation resurgence. The Federal Reserve’s latest economic projections, released just last week, may have already become stale. 

An environment already grappling with significant uncertainty has gotten even more uncertain. 

Economic and Earnings Calendar

Monday

• June S&P Global US PMIs: These indexes track how purchasing managers across different industries feel about the business environment. 
• May Existing Home Sales: Most home transactions in any given month tend to come from the existing market, and as a result set the tone for the broader housing market.
• Fedspeak: Chicago Fed President Austan Goolsbee will participate in a moderated discussion and Q&A as part of the Milwaukee Business Journal’s Mid-Year 2025 Outlook event. New York Fed President John Williams and Fed Governor Adriana Kugler will host a Fed Listens event.
• Earnings: FactSet Research Systems (FDS)

Tuesday

• June Philadelphia Fed Non-Manufacturing Activity: The Philadelphia Fed’s survey of services executives in the region on business conditions and their outlook. 
• April FHFA House Price Index: This is a broad measure of single-family house prices released by the Federal Housing Finance Agency. 
• April S&P CoreLogic Case-Shiller Home Price Index: This is a private sector measure of national home prices. After a period of slight decline in the second half of 2022 and early 2023, the index returned to growth and is now at record highs. 
• June Richmond Fed Manufacturing Activity: The Richmond Fed’s survey of manufacturing executives in the region on business conditions and their outlook. 
• June Richmond Fed Non-Manufacturing Activity: The Richmond Fed’s survey of services executives in the region on business conditions and their outlook. 
• June Conference Board Consumer Confidence: How consumers feel about economic conditions affect their spending habits. This survey places a particular focus on job availability and the state of the labor market.
• Fedspeak: Cleveland Fed President Beth Hammack will discuss monetary policy at the Barclays-CEPR Monetary Policy Forum 2025. Fed Chair Jerome Powell will testify before the House Committee on Financial Services on The Federal Reserve’s Semi-Annual Monetary Policy Report. Williams will give keynote remarks at a Center for Economic Growth and NY CREATES event.
• Earnings: Carnival (CCL), FedEx (FDX)

Wednesday

• May New Home Sales: While only a minority of home transactions in any given month come from new constructions, these home prices tend to be more cyclical and give insight into developing trends.
• Weekly Mortgage Applications: Mortgage activity gives insight on demand conditions in the housing market.
• Earnings: General Mills (GIS), Micron Technology (MU), Paychex (PAYX)

Thursday

• May Wholesale Inventories and Sales: Wholesalers often operate as an intermediary between manufacturers and retailers, serving as a key part of the goods supply chain. 
• May Wholesale and Retail Inventories: Wholesalers and retailers often operate as intermediaries for the sale of manufactured products, serving as a key part of the goods supply chain. 
• 1Q GDP Third Estimate: The primary measure of economic activity in the United States, which is measured as total expenditure on a country’s goods and services.
• May Chicago Fed National Activity Index: This is a monthly index put together that incorporates 85 indicators from four categories: production and income; employment, unemployment, and hours; personal consumption and housing; and sales, orders, and inventories.
• May Factory and Durable Goods Orders: These metrics give insight into underlying trends for leading cyclical indicators. 
• June Kansas City Fed Manufacturing Activity: The Kansas City Fed’s survey of manufacturing executives in the region on business conditions and their outlook.
• Weekly Jobless Claims: This high frequency labor market data gives insight into filings for unemployment benefits. Jobless claims have continued to show a labor market that remains strong despite having cooled.
• Fedspeak: Richmond Fed President Tom Barkin will discuss the economy at a New York Association for Business Economics event. Hammock will give opening remarks at an event hosted by the regional Fed bank on housing, the workforce, and economic development. Fed Governor Michael Barr will discuss community development and the Fed’s objectives at the Cleveland Fed bank conference.
• Earnings: McCormick & Company (MKC), Nike (NKE), Walgreens Boots Alliance (WBA)

Friday

• May Personal Income and Spending: These numbers give insight into how Americans are doing, which is important since consumer spending accounts for about two-thirds of economic growth in the United States. 
• May Personal Consumption Expenditures Price Index: The Fed targets this inflation measure for its price stability mandate and believes PCE to be the best measure of consumers’ spending habits. 
• June University of Michigan Consumer Sentiment: How consumers feel about economic conditions affect their spending habits. This survey places a particular focus on inflation and its trajectory. 
• June Kansas City Fed Non-Manufacturing Activity: The Kansas City Fed’s survey of services executives in the region on business conditions and their outlook.
• Fedspeak: Williams will serve as chair for a Bank for International Settlements event. Hammac and Fed Governor Lisa Cook will participate in a Fed Listens event at the Cleveland Fed conference.

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