The June jobs report out next week is expected to continue a trend of disappointing job growth. U.S. stock markets will close early on Tuesday and remain closed all day Wednesday for the July 4th holiday.
Economists are predicting 100,000 new jobs were created in June, better than the measly 69,000 created in May but well below the 200,000 range established earlier this year. The report from the U.S. Labor Department is due Friday. The unemployment rate is expected to remain unchanged at 8.2%.
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Labor markets have weakened considerably as the weather has turned warmer and the poor numbers have impacted consumer sentiment and consumer spending.
Investors will also be closely watching a meeting of the European Central Bank on Thursday at which an interest rate cut is expected to provide an economic boost for the troubled eurozone. The European debt crisis has moved to the forefront of global economic concerns again as Spain has joined Greece on the verge of a financial meltdown. A rescue plan for European banks announced Friday cheered markets -- but there have been numerous rescue plans before this one.
Auto makers are scheduled to report June sales on Tuesday and the numbers are expected to show continued strength for that sector. The auto industry, despite the struggling jobs market, has shown signs of a strong rebound from the worst of the financial crisis nearly four years ago. Edmunds.com, an online research firm, predicts sales of new cars in the U.S. rose 21% in June from the same period a year ago.
Two of the big three Detroit auto companies – General Motors (NYSE:GM) and Chrysler – were forced into bankruptcy in 2009 and likely would have disappeared altogether without the help of government bailouts.
But since then all of the big U.S. car makers have streamlined their operations and now focus more of their attention on building smaller, more fuel efficient cars in an effort to better compete with the dominant Japanese car makers.
Only a handful of companies will be reporting quarterly earnings, including: Acuity Brands (NYSE:AYI), International Speedway (NASDAQ:ISCA) and Xyratex Ltd. (NASDAQ:XRTX).