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Market Trading EssentialsJune 8, 2021

3 minutes read

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Tuesday, June 8, 2021

Jobs, inflation, and memes all get fresh data this week.

Yes, we know, it’s already Tuesday.

But a really interesting week for economic data and corporate news is just getting underway.

Later this morning we’ll kick off three straight days of data that will offer updates on the biggest debates happening in the market right now — the labor market recovery, inflation pressures, and meme stocks.

In a way, all of these arguments can be connected with something like: Are people making so much money trading meme stocks with their stimulus checks that they don’t need to go back work? And so on and so forth.

But each of these debates can also get quite detached from what the latest data tell us is or is not going on. Labor, prices, and the social role of markets are financial as well as political questions. And they each attempt an answer at what we should do with our time and how we should be compensated for it.

Fortunately, the next three days offer us data, not opinions, on developments along each front. The philosophical debates can resume in a week.

Thursday morning’s inflation reading for May is likely to be the biggest market mover.

The consumer price index for May is expected to rise 4.7% over last year, which would be the most since 2008. On a “core” basis, which strips out the more volatile cost of food and gas and is preferred by policymakers, prices are expected to rise 3.4%. This print would be the hottest annual core inflation reading since the early ’90s.

As Yahoo Finance’s Emily McCormick outlined in a preview all of this week’s economic data, Wall Street economists see inflation as a “secondary” concern when compared to talk about the Fed pulling back on its bond purchase program. But as we wrote in the Morning Brief last month, investors seem to be growing impatient with the Fed’s insistence that inflation pressures will be transitory. Impatience that grew after just one month of hotter-than-expected inflation. A second straight month of inflation beating expectations would only heighten this debate.

On the labor side, the job openings and labor turnover survey for April — also known as the JOLTS report — will be published at 10:00 a.m. ET on Tuesday. In March, the JOLTS data showed a record number of jobs were open while hiring struggles were rampant. Last week’s jobs report showed this dynamic didn’t change much over the last few months.

And then on Wednesday, GameStop (GME) will report its latest quarterly results, offering a key update on the fundamental story driving a stock that remains at the center of the reemergent meme trade.

The social forces driving small-time traders to names like AMC (AMC), GameStop and others are the basis of endless debates about the nature of the modern market. But the GameStop story began in the summer of 2020 with a fundamental case outlined by Redditors and YouTubers that at ~$4 per share, GameStop was undervalued.

Before members of Congress in February, Keith Gill — who became a folk hero for his winnings made buying GameStop shares and options — reiterated that he believed shares of the company were attractive relative to the company’s long-term growth potential. At that time, shares of GameStop were trading at around $45; on Monday, the stock closed at $280.

By Myles Udland, a reporter and anchor for Yahoo Finance Live. Follow him at @MylesUdland

What to watch today

Economy

6:00 a.m. ET: NFIB Small Business Optimism, May (101.0 expected, 99.8 in April)
8:30 a.m. ET: Trade balance, April (-$68.7 billion expected, -$74.4 billion in March)
10:00 a.m. ET: JOLTS Job Openings, April (8.200 million expected, 8.123 million in March)

Earnings

6:30 a.m. ET: Thor Industries (THO) is expected to report adjusted earnings of $2.32 per share on revenue of $3.00 billion
8:00 a.m. ET: Academy Sports & Outdoors Inc. (ASO) is expected to report adjusted earnings of 83 cents per share on revenue of $1.48 billion