The local stock market looks set for a sharp dip at the open this morning, in what could prove to be the first real challenge presented to Australian investors in some time. US shares tumbled on Friday evening as traders took notice of one Fed Reserve member comments that went further than the bank mid-week update, predicting the first interest rate hike in 2022. Commodity prices also continued to sour on a strong greenback, putting pressure on metals, agriculture and energy shares.

Economic calendar and news

After last week surprise employment data stunned local economists, attention will turn to other data-points in what is otherwise a quiet agenda for Australian economic data.

Preliminary retail sales data for May will be published today, while from the middle of the week interim flash' data on manufacturing and services activity will be on show.On the back of its Board meeting last week, where it outlined an accelerated timeline for the first interest rate hikes, the Fed Reserve won'tescape attention this week. Several members of the central bank will be speaking throughout the week, including Chair Jerome Powell, who is expected to testify before US Congress on the Federal Reserve's response to the coronavirus pandemic. Closing out the week, however, will be the personal consumption expenditures inflation index, which the Fed will be keeping an eye on as its preferred measure of inflation.There may also be heightened interest in policy out of China, with the nation last week seeking to have an impact on commodity prices through news of a planned release of key base metal reserves in aluminium, copper and zinc.

Stocks on watch

After the ASX closed for trade on Friday, gold prices continued retreating into the weekend and that will likely put pressure on miners of the precious metal, including US-heavyweight Barrick Gold (NYSE: GOLD), and smaller players from Australia like Regis Resources (ASX: RRL), De Grey Mining (ASX: DEG) and St Barbara (ASX: SBM), to name a few. Gold begins the new trading week at a price of around US$1,765/oz, shedding more than US$100/oz last week.Meanwhile, other precious metals like silver and platinum, and base metals like copper lost around 7 to 8% of their value last week. This had a profound impact on stocks such as Silver Mines Limited (ASX: SVL), OZ Minerals (ASX: OZL) and Sandfire Resources (ASX: SFR), with these names likely to be in the spotlight once again depending how these commodities shape up following last week selling action. Similarly, energy shares ended the week on a downbeat note as concerns started to rise around the sudden flattening in the yield curve - a phenomenon usually seen when rates are rising - on the back of prospective interest rate hikes. Major oil names like BP (NYSE: BP), Chevron (NYSE: CVX) and ConocoPhillips (NYSE: COP) tumbled even though the price of crude oil pared its weekly losses on Friday.Elsewhere, agriculture-related stocks may also see a higher-than-normal level of interest on the back of movements in the price of corn, soybeans and wheat, which all tumbled last week. As a supplier of goods and services to many commodity operators in the agriculture segment, Elders (ASX: ELD) is arguably the most-leveraged stock through its indirect connection.A weaker yield curve, tied to profitability among US banks, dampened sentiment for Bank of America (NYSE: BAC), Goldman Sachs (NYSE: GS) and JPMorgan Chase (NYSE: JPM), which each tanked more than 7% last week. The reversal in play abroad may flow through to ASX-listed bank shares like Commonwealth Bank (ASX: CBA), which have been outperforming but are susceptible to movements from offshore peers.Having spurred on gains across the ASX last week, and holding up better than the rest of the market in the US last week, tech shares could prove a watch-point. In particular, there will be close scrutiny to see if investors have rotated out of value stocks and back into growth plays, in what would be an unwinding of the reopening economy' trade first seen some months back. Seek (ASX: SEK), Megaport (ASX: MP1) and REA Group (ASX: REA) were all flying high last week, setting new records. Xero (ASX: XRO) and Afterpay (ASX: APT) hit monthly highs last week, although they were not alone as trusted blue-chip names such as Wesfarmers (ASX: WES) and Telstra (ASX: TLS) went one better in notching up yearly highs.