Sunday, October 03, 2004

Weekly Outlook

There are a few important economic reports and some significant corporate earnings reports scheduled for release this week. Economic reports include Factory Orders, ISM Non-Manufacturing, Initial Jobless Claims, Consumer Credit, Unemployment Rate, Average Hourly Earnings, Change in Non-farm Payrolls, Average Weekly Hours and Wholesale Inventories. ISM Non-Manufacturing and the Change in Non-farm Payrolls both have market-moving potential.

Apollo Group(APOL), Genentech(DNA), Monsanto(MON), Alcoa(AA), Costco(COST), Accenture(ACN) and General Electric(GE) are some of the more important companies that release quarterly earnings this week. There are also a number of other events that have market-moving potential. Multiple Federal Reserve Member speeches, the JP Morgan Asia Pacific Conference, Goldman Sachs Communacopia Conference, CSFB Medtech Conference, Vice-Presidential Debate, Merrill Lynch India Investor Forum and Chain Store Comp Sales Releases could also impact trading this week.

Bottom Line: I expect U.S. stocks to finish the week modestly higher on continued optimism over accelerating economic growth, diminishing domestic terrorism fears and short-covering. Investor complacency and the market's technically overbought state will likely hold gains in check. A further rise by Senator Kerry in the polls or another spike in oil prices would likely send stocks lower for the week. My short-term trading indicators are giving Buy signals and the Portfolio is 125% net long heading into the week.

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