Weekly Outlook

There are a few economic reports and some significant corporate earnings reports scheduled for release this week. Economic reports include Existing Home Sales(Tues.), Durable Goods Orders(Wed.), Initial Jobless Claims(Wed.), Final Univ. of Mich. Consumer Confidence(Wed.), New Home Sales(Wed.) and the Help Wanted Index(Wed.). Home Sales and Consumer Confidence have market-moving potential.

Campbell Soup(CPB-Mon.), Analog Devices(ADI-Tues.), Deere & Co.(DE-Tues.) and H&R Block(HRB-Tues.) are some of the more important companies that release quarterly earnings this week. Finally, the bond market will close at 2 p.m. ET on Wednesday and Friday, and the stock market will be open for a half day on Friday.

Bottom Line: I expect U.S. stocks to finish the week modestly higher on seasonal strength, better economic reports, declining energy prices, short-covering and bargain-hunting. New inflows into equity funds should also continue to boost shares. I still believe any pullback over the next few weeks will be mild as investors who missed the rally jump in, shorts cover to protect gains and new inflows are put to work on the long side. As I forecasted a few months ago, technology shares have substantially outperformed the market since August lows. I expect their outperformance to continue over the intermediate-term. My short-term trading indicators are still giving Buy signals and the Portfolio is 75% net long heading into the week.