Hello friends and Fortune readers,
This week kicks off with global markets on the edge of their figurative seats as the world braces for further fallout from the U.K.’s historic decision to leave the European Union—a move that sent stocks diving on Friday. Meanwhile, in the U.S., several important economic reports will become available this week, while the president makes his way north of the border to meet with fellow North American leaders, and several big companies—from General Mills to Nike—will report their latest quarterly results. Also starting this week will be one of the biggest tennis tournaments of the year, with action picking up through Independence Day Weekend.
Here’s what you need to know for the week ahead.
1. More “Brexit” fallout
U.K. voters decided last week to leave the European Union, a decision that had a seismic effect on global markets, as stock and commodity prices plummeted across the world (minus gold and other precious metals) on Friday, and the value of the pound dropped more than 8%. Global markets lost roughly $2 trillion in value on Friday and, while prices could bounce back somewhat at the beginning of this week, the rebound will likely be short-lived as the U.K., Europe and the rest of the world tries to sort out the aftermath of the country’s historic vote. Global financial leaders such as European Central Bank President Mario Draghi, U.S. Federal Reserve Chair Janet Yellen, and the Bank of England’s Mark Carney will all speak at a three-day ECB forum this week in Portugal, where the Brexit and its global fallout will certainly be a dominating topic of discussion. Meanwhile, foreign ministers from several founding member countries met in Berlin over the weekend to discuss European policy issues.
2. U.S. economic data
Aside from watching how the world continues to react to the situation in Europe, the U.S. markets will be weighing a fair amount of new data on the U.S. economy coming out this week, including consumer spending and manufacturing numbers. The Commerce Department is expected to report on Wednesday that U.S. consumer spending improved by 0.4% in May, which follows April’s 1% bump, while new numbers are also expected to show an increase in consumer confidence in June from the previous month. Meanwhile, the Institute for Supply Management’s Friday manufacturing index report is likely to show a slight improvement for that sector to start June. And, the third estimate so far for first-quarter gross domestic product will likely show that the U.S. economy expanded at a 1% annualized rate, which is a slight improvement over the 0.8% bump previously reported.
3. Earnings: General Mills, Monsanto, Nike
Athletic apparel giant Nike (NKE) reports fourth-quarter numbers on Tuesday and the world’s largest sportswear-maker is expected to post quarterly sales that fall just short of Wall Street’s expectations, as the strong U.S. dollar hurt Nike’s overseas sales figures while the company has also seen increased competition from rivals Adidas and Under Armour. On Wednesday, Monsanto (MON) will make its first quarterly report since the seeds and agrochemicals company turned down a $62 billion takeover attempt by Bayer AG (BAYN) last month. Investors will be interested to hear about whether or not a deal could still get done. Also reporting on Wednesday is General Mills (GIS), and the maker of Cheerios and other food products has been working to cut costs due to declining sales, as fourth-quarter revenue is expected to have dropped off yet again.
Also reporting earnings this week is cruise ship operator Carnival (CCL), beer and spirits producer Constellation Brands (STZ), and packaged foods giant ConAgra Foods .
4. The “Three Amigos” Summit
President Barack Obama will head to Ottawa to meet with Canadian Prime Minister Justin Trudeau and Mexican President Enrique Pena Nieto for the so-called “Three Amigos” Summit. In addition to addressing Canadian Parliament, Obama’s meeting with his fellow North American leaders will focus on trade discussions at a time when the idea of free trade has been the subject of harsh criticism during the current U.S. election cycle. The GOP’s presumptive candidate, Donald Trump, is also causing tension in the U.S.-Mexico relationship over his pledges to deport millions of Mexican immigrants from the U.S. and to build a wall along the countries’ border while making “Mexico pay for it.”
Meanwhile, in other global leadership news, both Australia and Spain will vote on their next leaders in nationwide general elections this week.
5. Wimbledon
The third, and most prominent, of tennis’ Grand Slam tournaments kicks off in London at the start of the week. Star players Novak Djokovic and Serena Williams will look to defend their respective 2015 titles at the two-week event that comes with major prize money for the winners and high-profile sponsorships from companies such as IBM (IBM) and Rolex. Snapchat, the ephemeral messaging service, also signed a three-year deal with Wimbledon’s host organization, the All England Club, to share live footage of the event and sell ad spots to companies like Stella Artois and Häagen-Dazs.
—Reuters contributed to this article.
