Week Ahead: Eye on Fed Speak, Retail Sales & Bank EPS

We have got a busy and interesting week ahead, with a full slate of economic data scheduled for reporting. Earnings reports are starting to flow as well, and so we will hear from some of the first major corporations this week, especially the banks. From our perspective, the most interesting thing to follow will be the Federal Reserve, given that many Fed heads are scheduled to speak this week. After last week’s poor employment report, it will be interesting to see how the tone from the Fed may or may not change.

Week Ahead

Index ETF	Last Week	YTD	Trailing 12-M
SPDR S&P 500 (NYSE: SPY)	+0.7%	+-0.9%	+24.5%
SPDR Dow Jones (NYSE: DIA)	-0.1%	+-1.3%	+21.2
PowerShares QQQ (Nasdaq: QQQ)	+0.8%	+-1.3%	+29.0%

Stocks managed to recover a bit of lost ground last week, mostly because it seems Fed pressure may come off with the questionable employment data just reported. Take note that gold still rose despite the gains in stocks; that has more to do with the expected impact on the dollar from the same Fed shift that stock investors are looking for. You’ll want to review our article just authored this weekend for more on this subject.

Economic Events

THIS WEEK’S ECONOMIC REPORT SCHEDULE
Economic Data Point	Prior	Expected
MONDAY
Int’l Auto Show Begins
Treasury Budget	-$135.2 B	+$44.0 B
Lockhart Speaks
Asian Financial Forum in China
TUESDAY
NFIB Small Business Optimism	92.5	93.5
Retail Sales	+0.7%	0.0%
-Less Autos & Gas	+0.6%	+0.3%
ICSC Weekly Store Sales	-5.4%
-Year-to-Year Pace	+1.7%
Redbook Store Sales	+4.1%
International Trade Prices (Exports)	+0.1%	+0.1%
-Imports	-0.6%	+0.4%
Business Inventories	+0.7%	+0.3%
Richard Fisher Speech
Plosser Speech
Egypt Referendum on Constitution
WEDNESDAY
Fed Beige Book
Atlanta Fed Biz Inflation Expectations
Mortgage Activity	+2.6%
Producer Price Index	-0.1%	+0.4%
-Core PPI	+0.1%	+0.1%
Empire State Manufacturing Index	0.98	3.3
EIA Petroleum Status
-Crude Oil Inventory	-2.7 M
-Gasoline Inventory	+6.2 M
Lockhart Speaks
Charles Evans Speaks
IMF’s LaGarde Speaks in DC
THURSDAY
Consumer Price Index	+0.0%	+0.3%
-Core CPI	+0.2%	+0.1%
Housing Market Index	58	57.5
Weekly Jobless Claims	330K	327K
Treasury Int’l Capital
Bloomberg Consumer Comfort	-28.4
EIA Natural Gas Report	-157 Bcf
Philly Fed Index	+7.0	+8.7
Bernanke Speaks
John Williams Speaks
FRIDAY
Housing Starts	1.091 M	0.985 M
-Permits	1.007 M	1.015 M
Industrial Production	+1.1%	+0.3%
-Capacity Utilization	79.0%	79.1%
-Manufacturing Production	+0.6%	+0.3%
Consumer Sentiment Index	82.5	83.5
JOLTS Index	3.925 M	3.930 M
Lacker Speaks
China Mobile (NYSE: CHL) Starts Selling Apple iPhone (Nasdaq: AAPL)

This week, our focus will be on Fed-speak after the Employment Situation Report disappointment of last week. The tapering trend that the Fed is currently on could be affected by that one single report, and if the tone of the discussion from Fed members this week changes at all, then the rally in the S&P 500 Friday could be something sustainable. Same goes for the SPDR Gold Shares or GLD (NYSE: GLD), which we wrote about this past weekend. The Fed Beige Book of regional economic indicators will also be released this week, adding to the flow of info. If the Fed stays stubbornly on a somewhat hawkish path, then stocks stand to lose ground – unfortunately, this is probably more likely.

We will receive a lot of new pricing data this week as well, including the PPI, CPI and import and export price data, so inflation will get a read. Obviously, the Fed is focused on inflation and jobs, and so this data proves very important. Investors should be rooting for healthy but not robust price increase, enough to keep the Fed on the gas. Any sign of inflation will scare the heck out of stocks.

Retail sales gets a monthly read Tuesday, but early reports on the holiday shopping season soured the group over the past week or so. Monday, lululemon (Nasdaq: LULU) warned on its results. Economists’ expectations for retail sales are set low, at no change for the latest period, so if some growth materializes it has a chance to stabilize the group.

A slew of housing and industrial data is also on the slate this week, so investors and econo-watchers will get a good read on the state of the economy and stocks generally.

Corporate Events

Earnings season has begun, but the reporting slate is still very light. Look for the major banks to report this week, including Citigroup (NYSE: C), J.P. Morgan Chase (NYSE: JPM), Wells Fargo (NYSE: WFC) and Bank of America (NYSE: BAC). We just authored a piece indicating that Bank of America is our favorite real estate stock for 2014.

HIGHLIGHTED EPS REPORTS
Company	Ticker
MONDAY
American Airlines	NYSE: AAL
Amgen	Nasdaq: AMGN
Dendreon	Nasdaq: DNDN
Hansen Medical	Nasdaq: HNSN
LiveDeal	Nasdaq: LIVE
M&T Bank	NYSE: MTB
Noodles & Co.	Nasdaq: NDLS
Sodastream	Nasdaq: SODA
St. Jude Medical	NYSE: STJ
The Wendy’s Co.	NYSE: WEN
Volcano	Nasdaq: VOLC
TUESDAY
Commerce Bancshares	Nasdaq: CBSH
J.P. Morgan Chase	NYSE: JPM
Linear Technology	Nasdaq: LLTC
Rocky Mountain Chocolate Factory	Nasdaq: RMCF
SemiLEDs	Nasdaq: LEDS
Washington Federal	Nasdaq: WAFD
Wells Fargo	NYSE: WFC
WEDNESDAY
AEP Industries	Nasdaq: AEPI
Bank of America	NYSE: BAC
Boston Private Financial	Nasdaq: BPFH
CLARCOR	NYSE: CLC
CSX	NYSE: CSX
El Paso Pipeline Partners	NYSE: EPB
Fastenal	Nasdaq: FAST
H.B. Fuller	NYSE: FUL
Kinder Morgan Energy Partners	NYSE: KMP
Kinder Morgan Inc.	NYSE: KMI
MB Financial	Nasdaq: MBFI
Plexus	Nasdaq: PLXS
WNS Ltd	NYSE: WNS
THURSDAY
American Express	NYSE: AXP
Associated Banc-Corp	Nasdaq: ASBC
Bank of Ozarks	Nasdaq: OZRK
BB&T Corp.	NYSE: BBT
BlackRock	NYSE: BLK
Capital One Financial	NYSE: COF
Citigroup	NYSE: C
First Republic Bank	NYSE: FRC
Goldman Sachs	NYSE: GS
Huntington Bancshares	Nasdaq: HBAN
iGATE	Nasdaq: IGTE
Intel	Nasdaq: INTC
People’s United Financial	Nasdaq: PBCT
PNC Financial	NYSE: PNC
PPG Industries	NYSE: PPG
Private Bancorp	Nasdaq: PVTB
Skyworks Solutions	Nasdaq: SWKS
SLM Corp.	NYSE: SLM
UnitedHealth Group	NYSE: UNH
Westamerica Bancorporation	Nasdaq: WABC
FRIDAY
ASA Gold & Precious Metals	NYSE: ASA
Bank Mutual	Nasdaq: BKMU
Bank of New York Mellon	NYSE: BK
Clubcorp	Nasdaq: MYCC
Comerica	NYSE: CMA
General Electric	NYSE: GE
Home BancShares	Nasdaq: HOMB
Morgan Stanley	NYSE: MS
Schlumberger NV	NYSE: SLB
SunTrust Banks	NYSE: STI
Webster Financial	NYSE: WBS

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