We’re heading into a much busier week than the last. Not only is the earnings calendar a bit heavier, but the economic calendar has more than a few market moving events on each day except for Wednesday. What’s on tap?
- Monday: The news event of the day should be earnings from Lowes. Lowes reported a blowout last quarter and sparked a rally in stocks. Unfortunately, as we predicted, the gains were due mainly to stealing market share from HD as opposed to strong underlying consumer/economic growth. Either way, expect optimism out of them. Those late buyers on Friday were betting on it….Also up:
Empire State Manufacturing 8:30 AM ET
Housing Market Index 1:00 PM ET
- Tuesday: Another day of important earnings news. Target, Home Depot, and HP all report. It’s unlikely that any of them are seeing strong underlying consumer trends, but don’t underestimate the power of cost cutting when we get their reports. We also get retail reports and housing news. Anything housing seems to be a home run for the bulls lately. The analysts simply have no clue where the figures are going to land. Also out:
- Wednesday: No economic news. The only earnings report of significance is Deere. No news days always scare me….Especially after we’ve had a big run-up.
ICSC-Goldman Store Sales 7:45 AM ET
Housing Starts 8:30 AM ET
Producer Price Index8:30 AM ET
Redbook 8:55 AM ET
- Thursday: Sears reports earnings. Who knows what Eddie Lampert is doing with this company. A few billion in default swaps could sway the quarter one way or the other. The only people who shop at Sears anymore are the ones who don’t have a Target that’s closer….On the economic front:
Jobless Claims 8:30 AM ET
Leading Indicators 10:00 AM ET
Philadelphia Fed Survey 10:00 AM ET
- Friday: Housing data and a Bernanke speech – every bulls dream come true. The market is infatuated with Bernanke these days. After years of failure he is seen as having the golden touch. Give him 10 years. I’d be willing to bet anyone that he goes down in flames due to the same destructive monetary policies that destroyed Greenspan’s reputation…
Existing Home Sales 10:00 AM ET
Ben Bernanke Speaks 10:00 AM ET
All in all I have to say that I wouldn’t want to be short heading into this week. The news, though not organically strong, has a positive tilt to it. We are certain to hear more news about weak consumers and poor underlying fundamentals, but “better than expected” could overrule all of that. As I’ve been saying lately, this bull market might have one last gasp of breath in it until the retailers finish reporting earnings. After that there are no catalysts to send us higher.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.