Just because the economic schedule isn’t chock full of data releases this week doesn’t mean we’re short on potential market movers! Here are the non-data events you should watch out for.
1. Special election in Georgia (June 20)
The 6th Congressional District in the state of Georgia will be having a special election to fill the now vacant seat, which was previously occupied by recently appointed Secretary of Health and Human Services Tom Price.
Now this might seem like a mere small-town event, but its outcome actually has significant repercussions on U.S. politics. Democrat Jon Ossoff and Republican Karen Handel are facing off in a neck-and-neck race for a seat that was previously won by a GOP landslide.
If the party is able to maintain its stronghold, it would be a big boost of confidence for the Trump administration and it would encourage Republican lawmakers to maintain their support for the Donald’s fiscal policy agenda. On the other hand, a Democrat victory would signal weakening support for Trump until the mid-term elections and possibly lead to a continued unwinding of the Trump rally in U.S. markets.
2. Queen’s speech (June 21)
Over in the United Kingdom, the Brits are eagerly awaiting the Queen’s speech, which marks the opening of the parliamentary session for the year and outlines the legislative priorities moving forward.Of course Brexit is expected to be at the front and center of the Queen’s remarks, especially since the speech for 2018 has been cancelled to give way to the transition. Many are hoping to hear some words of reassurance that could restore confidence in the ability of the government and economy to make it through the split.
Apart from that, Labour leader Jeremy Corbyn is also expected to deliver his alternative version of the Queen’s speech to urge other officials to overthrow the Conservative government. Meanwhile, Prime Minister Theresa May is still busy trying to seal the deal on a coalition government. Phew!
3. Brexit negotiations (All week)
As though things aren’t hectic enough in Europe, Brexit negotiations are set to kick off this week and headlines on these talks are likely to push the pound and euro around.
Initial discussions are expected to focus on the uncertainties pertaining to EU citizens and the potential impact on borders, particularly for Ireland. According to European Commission lead negotiator Michel Barnier, they will first set their timetable and priorities for the talks.
U.K. lead negotiator David Davis sounded a bit more cheery in assuring that the talks will be constructive, adding that the recent moments of crisis in the country should help solidify their relationship with their closest allies.
A brief opening session is scheduled, to be followed by a 90-minute session to set their agenda for the negotiations. Members of both teams will then split into working groups for initial discussions, which will be capped off by a closing session from the principal negotiators by 5:30 pm GMT. A press conference is scheduled to take place right after.
With that, this week could be a headline-driven one, marking a change of pace from the past few days wherein the focus was mostly on monetary policy. If you’re uncomfortable trading around these potential high-risk events, there’s no shame in sitting on the sidelines and watching price action unfold instead.