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The week's economic schedule is a light one, though the all-important Retail Sales metric comes due to close the period, along with a fresh consideration of Consumer Sentiment. In this holiday shopping season, those two reports alone offer importance enough to investors perusing for real economic recovery. Several of the world's central banks will weigh in as well, along with the voices of our Fed. The economic schedule also includes news on Wholesale and Business level Inventories, another important barometer, so stay in touch with our informative schedule throughout the week.
Monday's news was dominated by the start of the Climate Change Conference activities in Copenhagen. Two significant headlines resulted, with the Europeans announcing a willingness to set a 30% green house gas emission reduction plan for 2020 IF it deemed the world's effort equal and deserving. The EU was unfortunately quite vague about what nation peers it was talking about (assume the US, China, Japan, India and perhaps Brazil). Also, the Europeans failed to detail what exactly "comparable commitments" means. Is it requiring an equal commitment or proportional, or some measure of its own?
Meanwhile, the American Environmental Protection Agency (EPA) determined that carbon dioxide and five other greenhouse gases are a threat to public health. As a result, the gases will be opened to regulation under the Clean Air Act. This means that even if the Senate fails to adopt legislation, the Administration can act. However, you can bet your bottom dollar the American courts are warming up for action.
Federal Reserve Chairman Ben Bernanke gave a luncheon address to the Economic Club of Washington DC. He said, "the economy confronts some formidable headwinds that seem likely to keep the pace of expansion moderate." He also reminded that the job market remains weak... in case you have been lost at sea for two years. The Fed is also not likely to boost interest rates anytime soon. In other Fed news, New York Fed President Dudley spoke at Columbia University.
The only economic report of the day came at 3:00 p.m. when October Consumer Credit was reported contracted by $3.5 billion, significantly less than the economists' consensus forecast for -$8.8 billion. September's credit was revised contracted by $8.7 billion, instead of the initially reported -$14.8 billion contraction. Much of the contraction is due to credit card companies putting the squeeze on folks ahead of the implementation of new reform. How do you like that by the way? Congress reforms credit card companies, but gives them a year to mitigate the impact by screwing you over royally... Too many Americans are receiving phone calls requiring their determination to accept a higher APR or close to their accounts, which in turn hurts their credit rating further. Guess the credit card lobby did its job well then...
Dubai World will meet with its main creditors this week. In stock news, MetLife (NYSE: MET) meets with investors, while Celgene presents its blood-cancer drug at conference. Also, a trial begins today between eBay (Nasdaq: EBAY) and Craigslist.
The corporate earnings schedule includes reports from Blyth (NYSE: BTH), Casey's General Stores (Nasdaq: CASY), Integral Systems (Nasdaq: ISYS), KMG Chemicals (Nasdaq: KMGB), Krispy Kreme Donut (NYSE: KKD), Pep Boys (NYSE: PBY), Resource America (Nasdaq: REXI), Retail Ventures (NYSE: RVI) and The Kroger Co. (NYSE: KR).
Tuesday brings the regular Same-Store Sales data. For the week ended November 28, sales slipped 0.1% against the prior week total (flat the week before). Following trend though, sales rose 3.1% over the prior year count (+3.3% the week before).
Business Roundtable will issue its economic outlook for the coming six months. The Bank of Canada is expected to hold its key rate steady.
An FDA advisory panel considers the pediatric safety of various drugs, including Bristol-Myers Squibb's (NYSE: BMY) Abilify. 3M (NYSE: MMM) will discuss its outlook with investors, while Bank of America's (NYSE: BAC) board has a meeting planned. Bankruptcy court considers CIT Group's exit plan, while Christie's in London auctions off a rare Rembrandt.
Tuesday's EPS schedule includes news from Bank of Nova Scotia (NYSE: BNS), H&R Block (NYSE: HRB), Imperial Sugar (Nasdaq: IPSU), NCI Building Systems (NYSE: NCS), Oil-Dri Corporation of America (NYSE: ODC), SAIC, Inc. (NYSE: SAI), Talbots (NYSE: TLB), The Cooper Cos. (NYSE: COO) and Toro (NYSE: TTC).
The House Financial Services Committee will consider more reform for the Securities Investor Protection Act.
The Mortgage Bankers Association will produce its Weekly Applications Survey. Last week's report for the week ended November 27 showed the Market Composite Index of application activity increased 2.1%, after seasonal adjustment. The seasonally adjusted Purchase Index improved by 4.1% over the prior week. The Refinance Index gained 1.7%, thanks to further contraction of mortgage rates. The average contracted rate on 30-year and 15-year fixed rate mortgages fell to 4.79% (from 4.82%) and 4.27% (4.32%), respectively. Be careful not to read too much into holiday period data.
The Wholesale Trade Report is due at 10:00 AM. Last month's report showed September Wholesale Inventories fell 0.9%, while Sales rose 0.9%. The Inventory-to-Sales Ratio decreased to 1.18 from 1.2 (revised).
The Petroleum Status Report is due at 10:30. Last week's data showed crude oil inventory increased by 2.1 million barrels in the week ended November 27. Gasoline stocks increased by 4.0 million barrels, while Distillate Fuel Inventories decreased by 1.2 million barrels. Look for another decline this week, as cold weather descended upon the Northeast.
Goldman Sachs (NYSE: GS) kicks off its US Financial Services Conference in New York. Yum! Brands (NYSE: YUM) holds an investor meeting, while Time Warner (NYSE: TWX) spins off AOL.
Look for earnings reports from Greif Brothers (NYSE: GEF), Innovative Solutions & Support (Nasdaq: ISSC), Jackson Hewitt Tax Service (NYSE: JTX), Men's Wearhouse (NYSE: MW), Pall Corp. (NYSE: PLL) and Powell Industries (Nasdaq: POWL).
Weekly Initial Jobless Claims data is due at 8:30. In recent weeks, we've seen steady improvement. Last week, initial filers for unemployment insurance amounted to 457K. The four-week moving average also declined by 14,250, to 481,250. This is very good news if it holds, as it seems to paint a clear signpost toward economic recovery.
International Trade data is due at 8:30 as well. September's data showed the trade deficit expanded to $36.5 billion. Economists see the deficit sticking in that range in October. The Bank of England will have rate news to report Thursday, and is seen keeping with its quantitative easing policy.
The Fed will issue its Flow of Funds Report, and Fed Governor Elizabeth Duke will address the Mortgage Foreclosure Policy Conference in Chicago. President Obama will venture far from his Chicago home town to collect his Nobel Peace Prize.
The RBC Cash Index is due at 10:00 a.m. November's confidence measure sank to a level of 30.2, from 51.8 in the prior month.
United Technologies (NYSE: UTX) meets with investors. Thursday's earnings news will emanate from BWAY Holding (NYSE: BWY), Ciena Corporation (Nasdaq: CIEN), Costco (Nasdaq: COST), Gildan Activewear (NYSE: GIL), Learning Tree Int'l (Nasdaq: LTRE) and Smithfield Foods (NYSE: SFD).
Retail Sales keys the wire on Friday. October's Retail Sales increased just 1.4%, due to a tough comparable for September. This past September included a late falling Labor Day weekend, giving back to school shoppers time in September to shop. Economists are looking for a 0.9% rise in November. Retail Sales Ex-Autos are seen rising 0.5%, after improving 0.2% last month. Sales in the auto market are seen normalizing this month, post "clunkers."
Also at 8:30, look for Import/Export data for the month of November. Import Prices are seen 1.2% higher, after a 0.7% increase in October.
The Reuters/University of Michigan Consumer Sentiment Index is due for 9:55 reporting. Economists forecast improvement to 68.2, versus the 67.4 reading at last check. Recall, sentiment took a spill in November.
A few days after the Wholesale data, Business Inventories are due for the month of October at 10:00 AM. Economists see inventories falling 0.2% this time around, after falling 0.4% in September. Sales fell 0.3% last time around.
ECB President Jean-Claude Trichet speaks in London on Friday. Illinois Tool Works (NYSE: ITW) will hold its investor day.
The day's earnings news includes data from HMV Group (LSE: HMV.L), MIRAIL Co. (OTC: MRLCF.PK) and Telecom Res. Services (Euronext: TLC.PA).
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