This Week May Offer Economic Fireworks

This week will be broken up by our nation’s celebration of Independence Day. Still, the rest of the week will make up for the break with several critical economic releases. While the quarter just ended last week, earnings season will not begin formally until next week. Thus, there are only a handful of earnings reports scheduled for this week.

Monday

The Institute for Supply Management publishes its Manufacturing Report on Business at 10:00 AM EDT. The ISM’s measure of manufacturing is expected by economists to have deteriorated in the month of June, to 52.0, from 53.5 in May. ISM’s index fell in May as well, dropping from 54.8 in April. The expectation seems out of sync with last months’ New Orders Index, which posted a 1.9 percentage point increase to 60.1. It is not, however, out of order, given the well-detailed decline in economies globally. American economic data has been deteriorating as well, though it is thus far not indicating recession.

The latest Construction Spending data is due at 10:00 AM as well Monday. Economists surveyed by Bloomberg expect construction spending rose 0.2% in May, after increasing by 0.3% in April.

Reporting earnings this Monday, Acuity Brands (NYSE: AYI), Bassett Furniture (Nasdaq: BSET), Cazador Acquisition (Nasdaq: CAZAU), Chimera Investment (NYSE: CIM), CHS Inc. (Nasdaq: CHSCP), GenCorp (NYSE: GY), Griffin Land & Nurseries (Nasdaq: GRIF), Hicks Acquisition (Nasdaq: HKAC), Hoku (Nasdaq: HOKU), Imperial Holdings (NYSE: IFT), Ixia (Nasdaq: XXIA), JDA Software (Nasdaq: JDAS), Moduslink Global Solutions (Nasdaq: MLNK), New Frontier Media (Nasdaq: NOOF), NewLead Holdings (Nasdaq: NEWL), Rocky Mountain Chocolate Factory (Nasdaq: RMCF), Saba Software (Nasdaq: SABA), Tel Instrument Electronics (NYSE: TIK) and a few others.

Tuesday

Motor vehicle sales will be reported for June Tuesday morning. The annual pace of domestic vehicle sales is expected by economists surveyed by Bloomberg to have slowed in June, to a rate of 10 million, down from 10.6 million in May. Though total vehicle sales are expected to have improved, to 13.9 million, up from 13.8 million in May. Last month, total vehicle sales fell by 4.4%, to the lowest sales rate of the year. After last week’s bad news for Ford (NYSE: F), investors in the shares and in General Motors (NYSE: GM), Toyota (NYSE: TM) and Honda (NYSE: HMC) will be tuned in.

U.S. Factory Orders for the month of May are due for report at 10:00 AM EDT Tuesday. Economists surveyed by Bloomberg see orders edging higher by 0.1%, after falling by 0.6% in April. Durable Goods Orders were reported just a week ago, offering insight into this report. They rose ahead of expectations but fell short when excluding transportation orders.

The International Council of Shopping Centers (ICSC) reports on retail same-store sales weekly. Last week, for the period ending June 23, same-store sales jumped 2.0% week-to-week. The weather certainly plays a role here, and so we may see a slip in the latest period. Last week’s data marked a 2.7% year-to-year increase, which is relatively weak.

The NYSE will close early as will fixed income markets. Tuesday’s EPS reports include Daxor (NYSE: DXR), Pansoft (Nasdaq: PSOF), Roberts Realty Investors (NYSE: RPI) and TSR Inc. (Nasdaq: TSRI).

Wednesday

It’s the 4th of July, Independence Day in the United States. The U.S. financial markets are closed for the day. Enjoy the fireworks and God bless America.

Thursday

Because of the holiday, Thursday will be especially busy. Five reports will reach the wire before the bell even rings. The most important of those will be the ADP Private Employment Report, published at 8:15 AM. The report is actually an estimate of the federal government’s data on monthly private nonfarm payrolls. Economists expect June’s result to show a net addition of 95,000 private nonfarm payrolls, which would mark a decrease from May’s +133,000 estimate.

Also in the pre-market, look for Challenger, Gray & Christmas’ monthly Job-Cut Report. Last month, the report showed a surge of 62,887 layoffs for May.

The Department of Labor will of course report on Weekly Jobless Claims at its usual 8:30 publishing time Thursday. Last week’s report showed claims stubbornly sticking high as the U.S. job market spoils. Economists see weekly claims running at about 386K this week, matching last week’s mark.

Individual retailers will be reporting their monthly chain store sales mostly on Thursday. Recent consumer confidence and spending data has been disappointing to say the least. So, the reports could spur reconsideration within the sector and sector allocation out of it. We recently discussed 5 stocks that should benefit if consumers check out, including Dollar Tree (Nasdaq: DLTR), eBay (Nasdaq: EBAY), Wal-Mart (NYSE: WMT), Amazon.com (Nasdaq: AMZN) and Cash America (NYSE: CSH).

The fifth data point to reach the wire Thursday morning might come first of all. The Mortgage Bankers Association (MBA) reports on mortgage application activity on a weekly basis. Last week, the MBA reported that mortgage application activity declined. Rates are still low, but money is also still hard to come by, so we continue to have low expectations with regard to housing.

At 9:45 AM, the Bloomberg Consumer Comfort Index will offer the latest take on the consumer mood. Last week’s report showed deterioration, as the comfort index improved 1.8 points, to negative 36.1.

At 10:00 AM, ISM posts its latest Nonmanufacturing Index, a measure of the nation’s service sector. It’s the most important part of our economy, making up approximately 90% of our economic production. Economists expect the reading for June to show deterioration to a mark of 53.0, down from 53.7 in May.

Both the EIA’s Petroleum and Natural Gas Reports will be published Thursday this week due to the holiday. At 10:30, the EIA publishes its Natural Gas Report. Last week, it showed working gas in storage increased by 57 Bcf, which was higher than last year at this time and above the five-year average. At 11:00 AM, the EIA reports on Petroleum Status. Crude oil decreased by 0.1 million barrels, and inventories were above the upper limit of the average range for this time of year.

The earnings schedule for Thursday includes reports from Ambow Education (Nasdaq: AMBO), China Technology Development (Nasdaq: CTDC), International Speedway (Nasdaq: ISCA), Rit Technologies (Nasdaq: RITT) and Xyratex (Nasdaq: XRTX).

Friday

It’s the close of the holiday shortened week, and it will go out with a second bang. The monthly Employment Situation Report is due this Friday. This report just happens to be the most widely followed report by the market and by Main Street. The president even comments on the data each time it is reported, and now his challenger does as well.

The report for May showed unemployment stuck at 8.2%, and nonfarm payrolls hardly budged, increasing by 69K through the month. For June, economists see the unemployment rate sticking at 8.2% again, with nonfarm payrolls increasing by a still pathetic 90K.

Monster Worldwide (NYSE: MWW) will post its Monster Employment Index for June. In May, it increased a point to 147, and it was up 3% year-over-year. The index is a gauge of U.S. online job posting activity, and with the job search market effectively moved online now, it matters.

The earnings schedule for Friday includes R.F. Monolithics (Nasdaq: RFMI), Rosetta Genomics (Nasdaq: ROSG) and Torch Energy Royalty Trust (NYSE: TRU).

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