Weekly Outlook

Click here for The Week Ahead by Reuters

There are some economic reports of note and a few significant corporate earnings reports scheduled for release this week.

Economic reports for the week include:

Mon. - Construction Spending, Pending Home Sales, ISM Manufacturing, ISM Prices Paid, Vehicle Sales
Tues. - None of note
Wed. - ISM Non-Manufacturing
Thur. - Initial Jobless Claims
Fri. - Change in Non-farm Payrolls, Change in Manufacturing Payrolls, Unemployment Rate, Average Hourly Earnings, Wholesale Inventories, Consumer Credit

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

Mon. - Intermagnetics General(IMGC), Jos. A. Bank(JOSB), Micron Technology(MU)
Tues. - Delta & Pine Land(DLP), Dresser-Rand(DRC), Telephone & Data(TDS)
Wed. - Acuity Brands(AYI), Bed, Bath & Beyond(BBBY), Monsanto(MON)
Thur. - American Greetings(AM), Constellation Brands(STZ), Immucor(BLUD), Pier 1 Imports(PIR), Rite Aid(RAD), Stolt Offshore(SOSA), Terex Corp.(TEX), Triarc Companies(TRY)
Fri. - Longview Fiber(LFB), Mills Corp.(MLS), Shaw Group(SGR), Verint Systems(VRNT)

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

Mon. - Platts Global Power Markets Conference
Tue. - CIBC Biotech & Specialty Pharma Conference, CSFB Real Estate Conference
Wed. - CIBC Biotech & Specialty Pharma Conference, CSFB Real Estate Conference
Thur. - CSFB Real Estate Conference, Goldman Small-cap Growth Conference
Fri. - None of note

BOTTOM LINE: I expect US stocks to finish the week mixed as mostly positive economic data, stable energy prices and short-covering offsets higher long-term rates and profit-taking. My trading indicators are now giving bullish signals and the Portfolio is 75% net long heading into the week.

Market Week in Review

S&P 500 1,294.83 -.62%*



Click here for the Weekly Wrap by Briefing.com.

First Quarter Scoreboard

Indices
S&P 500 1,294.83 +4.21%
DJIA 11,109.32 +4.24%
NASDAQ 2,339.79 +6.38%
Russell 2000 765.14 +13.95%
DJ Wilshire 5000 13,121.56 +5.0%
S&P Equity Long/Short Index 1,165.57 +5.0%
S&P Barra Growth 609.95 +2.25%
S&P Barra Value 681.66 +5.27%
Morgan Stanley Consumer 607.81 +2.76%
Morgan Stanley Cyclical 813.87 +3.67%
Morgan Stanley Technology 548.10 +5.11%
Transports 4,568.00 +8.87%
Utilities 389.01 -3.97%
S&P 500 Cum A/D Line 8,408.00 +10.0%
Bloomberg Crude Oil % Bulls 48.0 +77.58%
Put/Call .80 +5.3%
NYSE Arms 1.66 +.61%
Volatility(VIX) 11.39 -5.63%
ISE Sentiment 120.0 -26.38%
AAII % Bulls 37.21 -.24%
AAII % Bears 32.56 -10.82%
US Dollar 89.73 -1.58%
CRB 333.18 +.41%

Futures Spot Prices
Crude Oil 66.35 +2.31%
Unleaded Gasoline 187.47 -1.07%
Natural Gas 7.21 -29.1%
Heating Oil 185.60 +3.40%
Gold 583.50 +8.64%
Base Metals 177.22 +16.28%
Copper 245.90 +23.82%
10-year US Treasury Yield 4.84% +10.25%
Average 30-year Mortgage Rate 6.35% +2.09%

Leading Sectors
Steel +40.81%
I-Banks +16.86%
Oil Service +14.39%
Networking +13.87%
REITs +13.98%

Lagging Sectors
Foods +2.34%
Hospitals +1.22%
Insurance -1.72%
Broadcasting -3.10%
Oil Tankers -6.38%

This Year’s Winners
This Year’s Losers

*3-Month % Change

Stocks Mixed into Final Hour as Lower Oil Prices Offset Quarter-end Profit-taking

BOTTOM LINE: The Portfolio is slightly higher into the final hour on gains in my Internet longs, Retail longs, Networking longs and Biotech longs. I have not traded today, thus leaving the Portfolio 75% net long. The tone of the market is mixed as the advance/decline line is slightly higher, sector performance is mixed and volume is below average. The ECRI Weekly Leading Index rose to 137.00 this week from 136.20 the prior week. This is off of cycle highs of 138.50 set the third week of January, but is still solidly higher from a reading of 132.00 during the last week of May 2005 and the long-term average of 128.90. This gauge of future economic activity is still forecasting healthy, but decelerating, U.S. growth. I expect US stocks to trade mixed into the close from current levels as short-covering offsets profit-taking at quarter’s end.

Today's Headlines

Bloomberg:
- Hard Rock Intl. is planning a $1 billion casino hotel in Atlantic City, New Jersey, the 13th in that city.
- General Motors(GM) may announce an agreement Monday to sell control of its finance unit to investors led by Cerberus Capital.
- Paris strikes and riots may scare away tourists during peak tourist season.
- Barton Biggs said US stocks may rise more than 20% this year, led by larger US technology companies such as Intel(INTC) and Cisco Systems(CSCO) as capital spending increases.
- Crude oil is falling the most in almost two weeks as concern eased over supply disruptions from Iran and as a damaged pipeline in Nigeria was repaired.

Wall Street Journal:
- China faces rising protectionist sentiment at home as growing foreign investment puts more Chinese companies under competitive pressure.
- Chinese telecom companies are resisting a government suggestion that domestic technology should be used to update wireless telephone systems over the next two years.
- China has become a world force in the use of solar power to provide hot water in homes.
- More US households are giving up traditional phones in favor of mobiles, citing Forrester Research.
- Hewlett-Packard(HPQ) flat-panel televisions incorporating Internet-ready technology will be sold at Best Buy(BBY) stores beginning next month.

NY Times:
- Federated Dept. Stores’(FD) Macy’s, Nordstrom(JWN) and QVC Inc. have begun selling clothes from women using a new universal size system, in an experiment to standardize how items fit.
- US African Americans are increasingly gaining access to, and becoming comfortable with, the Internet, signaling the closing of the so-called digital divide.
- Some personnel at ESPN disagree with the cable sports network’s decision to televise a reality series about San Francisco Giants outfielder Barry Bonds.
- Insurers that offer supplemental insurance for Medicare recipients are using the new prescription drug benefit to attract new customers.

Reuters:
- Comcast(CMCSK) and Time Warner(TWX) executives said they support Cablevision Systems’(CVC) plan to allow subscribers to record programs on the company’s computer servers.

Moscow Times:
- Russia’s Cabinet approved measures to draft more men into the military.

AFP:
- Iran will not use its crude oil supplies as a lever in a dispute with western countries over its nuclear program, citing Foreign Minister Mottaki.