Here are five things you must know for Monday, June 7:
1. -- Stock Futures Waver as Wall Street Weighs Inflation and Taxes
Stock futures fluctuated Monday after Wall Street rallied to close out last week following a jobs report that eased concerns the Federal Reserve would be pulling back on economic support.
Contracts linked to the Dow Jones Industrial Average rose 33 points and S&P 500 futures were down 2 points. Nasdaq futures declined 24 points as investors weighed what impact a 15% global corporate tax agreement secured by the G-7 over the weekend would have on tech giants.
Stocks finished higher Friday and tech shares surged after the U.S. added fewer-than-expected jobs to payrolls in May, leading investors to believe the Federal Reserve won't be paring back its $120 billion of monthly asset purchases anytime soon. The S&P 500 closed at 4,229, just short of a record high.
The Dow gained 0.7% for the week, the S&P 500 rose 0.6% and the Nasdaq added 0.5%.
Wall Street this week will be awaiting Thursday's report on consumer prices for further signs of inflation risks. The Federal Reserve has argued that any spikes in inflation as the economy recovers from the coronavirus pandemic will be transitory.
Treasury Secretary Janet Yellen said President Joe Biden should push forward with his $4 trillion spending plans even if they cause an inflation spike into next year. She also told Bloomberg in an interview that slightly higher interest rates would be a plus.
“If we ended up with a slightly higher interest rate
environment it would actually be a plus for society’s point of
view and the Fed’s point of view,” Yellen told Bloomberg.
2. -- This Week's Calendar: Consumer Price Index, GameStop Earnings
The U.S. economic calendar on Monday is light on data but later in the week will see information on consumer prices, consumer sentiment and jobless claims.
Earnings are expected Monday from Coupa Software (COUP) - Get Report and Stitch Fix (SFIX) - Get Report. Reports are expected later in the week from GameStop (GME) - Get Report, Chewy (CHWY) - Get Report, Dave & Buster's (PLAY) - Get Report and Signet Jewelers (SIG) - Get Report.
3. -- Apple's WWDC - What to Expect
New hardware also could be unveiled, but according to Apple Maven Daniel Martins those announcements tend to be rare during the developers’ conference.
Morgan Stanley analyst Katy Huberty, however, claimed it was "likely" that Apple will announce at least one new MacBook model powered by Apple silicon, MacRumors reported.
"In the last 12 months, Apple has introduced not only new Macs (MacBook Air, MacBook Pro 13", and the Mac Mini) with M1, but also a high end 12.9" iPad Pro with the M1 chip," wrote Huberty. "We expect this momentum to continue into WWDC 2021, and based on our checks, we believe it's likely Apple launches a new MacBook featuring in-house designed silicon."
4. -- Biogen Rises as FDA Decision Expected on Alzheimer's Drug
Biogen (BIIB) - Get Report was rising more than 4% in premarket trading Monday as investors awaited the Food and Drug Administration’s decision on whether to clear the company’s aducanumab Alzheimer's drug.
An approval would make aducanumab the first authorized treatment for Alzheimer's, the memory-destroying disease.
Analysts have been mixed on whether clearance will be granted. Whatever the FDA decision, the impact on Biogen’s stock could be huge, they said.
This is “the mother of all binary events,” said J.P. Morgan Chase analyst Cory Kasimov. A rejection could drop Biogen shares to $200, while approval could boost them to $450, he said.
Mizuho analyst Salim Syed estimated the stock could rise to around $400 or fall to roughly $200 depending on how the FDA decides.
Biogen shares rose 3.27% to $295.50 in premarket trading.
5. -- El Salvador Could Adopt Bitcoin as Legal Tender
El Salvador President Nayib Bukele said he was putting together proposed legislation to make Bitcoin legal tender alongside the U.S. dollar in the Central American nation.
“Next week I will send to Congress a bill that will make bitcoin a legal tender in El Salvador,” he said in a video broadcast at the Bitcoin 2021 conference in Miami. “In the short term, this will generate jobs and help provide financial inclusion to thousands outside the formal economy and in the medium and long term we hope that this small decision can help us push humanity at least a tiny bit into the right direction."
Bitcoin was up slightly Monday, rising 1.31% to $36,547. The world's largest cryptocurrency set a record high of more than $64,000 in mid-April.
"Bitcoin has a market cap of $680 billion dollars," said Bukele over a thread on Twitter, arguing that if 1% of the cryptocurrency was invested in El Salvador, "that would increase our GDP by 25%. On the other side, #Bitcoin will have 10 million potential new users and the fastest growing way to transfer 6 billion dollars a year in remittances."
Remittances from Salvadoran citizens working in the U.S. make up more than a fifth of El Salvador’s gross domestic product, according to the U.S. State Department.