Saturday, July 17, 2010

Economic Indicators for the week of July 19th

First a comment about yesterday's market action. The most important data from yesterday's market drop in all Indexes was that the Volume was the highest since June 25th and the drop was the largest since June 29th. And yesterday, the Candlestick pattern for the Dow and many other indexes, was the Black Opening Marubozu pattern. This pattern shows that the market dropped from the opening to most of the day, but did not close at the lows, leaving a small shadow. I suspect more down days will follow yesterday's close.

Here is the economic data to be released this coming week:

Monday, July 19th 10:00am EST:
-National Home Builders Index for July. Prior month data was 17 for June.

Tuesday, July 20th 8:30am EST:
-Building Permits for June. Prior month of May data was 574K permits. Expectations are for watered down 560K permits.
-Housing Starts for June. Prior month of May data was 593K starts. Expectations are that the number will drop to 570K starts.

Wednesday, July 21st 10:30am EST:
-Crude Inventories for week. Prior readings were for 5.06 Million barrels.

Thursday, July 22nd 8:30am
-Initial Jobless Claims for week. Prior readings were 429K and expectations are that number will increase to 440K. (Comment: A larger number will cause a significant market negative reaction. It is the 2nd most important number of the week.)
-Continuing Claims. Prior reading was 4.681 Million people. Expectations are for 4.600 Million. (Comment: If this number also increases significantly the market will most likely have a significant negative reaction. It is the 3rd most important number of the week.

Thursday, July 22nd 10:00am
-Existing Home Sales for June. Prior month of May data was 5.66 Million homes sold. Expectations are for 5.40 Million homes. (Any number below 5.0 will cause alarm to the market.) It is the #1 most important data released for the week.
-Leading Indicators. Expectations are for a -0.4% number. (When Leading Indicators are negative, that is not showing growth in our economy but rather a slowing of the economy.

Just from the expectations by economists with all these numbers, you can see a negative tone to what will be announced this week. Normally that will contribute to the market decline. However, also in the mix are earnings announcements for the coming week.

Monday: IBM, Texas Instruments and Hasbro

Tuesday: Apple, Goldman Sachs, Bank of NY, Johnson and Johnson, PepsiCo, United Airlines, United Health, Yahoo

Wednesday: Abbott Labs, American Airlines, Coca-Cola, EBay, Morgan Stanley, EMC, Starbucks, US Bancorp, United Technologies, US Airways, Netflix, Wells Fargo

Thursday: 3m, Amazon, American Express, AT&T, Capital One, Continental Airlines, E-Trade, Eli Lilly, Hershey, JetBlue, Microsoft, Philip Morris, Travelers Insurance, Union Pacific, Xerox

Friday: Ford, Honeywell, Kimberly-Clark, McDonalds, Schlumberger, Verizon

These are but a few earnings to be released this week but as you can see any can move the market and most likely will some of the time. The facts to pay particular attention to is the economic data for the week as that will set the tone whether earnings exceed, meet or fail to meet expectations. It is the water that surrounds each of these companies and the environment they find themselves in with investors. High Unemployment, low Consumer Confidence, dropping housing values and a climate of worry about Deflation now by the Fed is the reflection from this water. Pay attention to your ASSets. :)

Also on Tuesday, the Senate is to vote on ending the Republican Filibuster on the Financial reform Bill and on extending Unemployment benefits for the millions of unemployed. Politics is another of the many variables affecting our economy with this divided government. You would think that elected officials would be interested in working together. But no, they are more worried about keeping their own jobs than they are you and your interests or your job. You can pick either Party here as it makes no difference as far as I can see. Bah, humbug!

Hope to see you here throughout each day this week. I post in the morning usually and then update the post throughout the day with my comments or observations and predictions. So visiting once only and you miss much. Just look at a few previous posts to see what I mean. Have a nice day! Summer is fun.

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Blogger Charles Amico said...

This from my friend Tom today:

"Come November, if the Republicans gain a few more seats in Congress, we're gonna see a deadlocked Congress. Nothing will improve. We'll be forced into deeper deflationary position with more head butting. This is not the game in Washington that the general public wants to see?"

Thanks Tom!

5:29 PM  

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