Weekly Outlook

There are a few important economic reports and some significant corporate earnings reports scheduled for release this week. Economic reports for the week include:

Tues. - Consumer Confidence
Wed. - Consumer Price Index, FOMC Meeting Minutes
Thur. - Durable Goods Orders, Initial Jobless Claims
Fri. - Preliminary 4Q GDP, Preliminary 4Q Personal Consumption, Preliminary 4Q Price Deflator, Existing Home Sales

Some of the more noteworthy companies that release quarterly earnings this week are:

Tues. - Autodesk(ADSK), Federated Department Stores(FD), Home Depot(HD) Novell(NOVL), Omnicom(OMC)
Wed. - Cablevision Systems(CVC), Lowe's(LOW), MCI Inc.(MCIP), Toll Brothers(TOL)
Thur. - Gap Inc.(GPS), H&R Block(HRB), HJ Heinz(HNZ), Kohl's(KSS), McAfee Inc.(MFE), Newmont Mining(NEM), Staples Inc.(SPLS), Clear Channel(CCU)
Fri. - None of note

Other events that have market-moving potential this week include:

Tues. - Morgan Stanley Basic Materials Conference
Wed. - Goldman Sachs Technology Symposium, Morgan Stanley Basic Materials Conference, Fed's Guynn speaks on Economic Outlook
Thur. - Goldman Sachs Technology Symposium, Morgan Stanley Basic Materials Conference, Fed's Poole speaks at Culver-Stockton College
Fri. - Goldman Sachs Agricultural Forum, Goldman Sachs Technology Symposium

Bottom Line: I expect US stocks to finish the week mixed as strong earnings and economic reports are offset by continuing worries over higher interest rates and energy prices. Crude oil is very close to breaking up through its downtrend line that has been in place since October of last year. However, I expect resistance at the $49-$50/bbl. level to hold. It would be a psychological negative for US equities if crude were to close above $50/bbl. The fact that long-term interest rates rose significantly last week and the Homebuilding Index posted gains bodes well for the group. I expect this sector to continue to outperform and make all-time highs over the coming months. I also expect long-term rates to head a bit higher in the near-term before turning lower again over the intermediate-term. My short-term trading indicators are still giving mixed signals and the Portfolio is 75% net long heading into the week.