Economic reports for the week include:
Mon. - None of note
Tues. - Minutes of Sept. 20 FOMC Meeting
Wed. - None of note
Thur. - Trade Balance, Import Price Index, Initial Jobless Claims
Fri. - Consumer Price Index, Advance Retail Sales, Industrial Production, Univ. of Mich. Consumer Confidence, Business Inventories
A few of the more noteworthy companies that release quarterly earnings this week are:
Mon. - Alcoa Inc.(AA), Genentech(DNA)
Tues. - Advanced Micro Devices(AMD), Apple Computer(AAPL), Merrill Lynch(MER)
Wed. - Harley-Davidson(HDI), Lam Research(LRCX), Monsanto Co.(MON)
Thur. - Genzyme(GENZ), Progressive Corp.(PGR), Tribune Co.(TRB)
Fri. - Arch Coal(ACI), Boston Scientific(BSX), First Data(FDC), General Electric(GE), JB Hunt Transportation(JBHT), Peabody Energy(BTU), Saks Inc.(SKS), UnitedHealth Group(UNH)
Other events that have market-moving potential this week include:
Mon. - US Bond Market Closed for Columbus Day, Banc of America Real Estate Conference
Tue. - Bear Stearns Retail Outing, Banc of America Real Estate Conference
Wed. - Banc of America Real Estate Conference, Fed Chairman Greenspan speaks, Fed’s Olson speaks
Thur. - None of note
Fri. - None of note
BOTTOM LINE: I expect US stocks to finish the week modestly higher on a bounce after recent losses. While last weeks lows may hold from an intermediate-term standpoint, I expect stocks to trade range-bound until closer to month’s end or early November as earnings worries increase. Subsequently, I expect a strong year-end rally to begin, led by the technology, retail, biotech, I-Banking, restaurant, gaming and airline sectors as earnings exceed lowered expectations, inflation fears subside and the energy price downtrend persists. Continued weakness in energy-related stocks should be more than offset by strength in most other market sectors. My trading indicators are giving bearish signals and the Portfolio is 50% net long heading into the week.
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