Economic Data Comes in Full Force This Week

Earnings were plainly in focus this past week, helping push the Dow Jones Industrial Average, S&P 500 and Nasdaq higher for the fourth consecutive week.  The S&P 500 has been a particular standout, rising for eight consecutive session, it’s longest winning streak since November 2004 (9 straight days) and taking the blue chip index to its highest level since late 2007 before the markets collapsed.

As of Friday’s close, the S&P 500 is only 73.13 points from all-time highs of 1,576.09 hit in October 2007.

174 companies in the S&P 500 have reported earnings so far with 68 percent topping consensus predictions of analysts and only 18 percent coming up short.

Economic data has largely taken a back seat to the earnings prattle with the bulls clearly in charge, even ignoring information that new home sales fell by 7.3 percent in December.

This coming week, financial reports will still be in investor’s crosshairs, but news from Washington will be coming in full force.  What to look for (“market moving” data in bold):

Monday

Durable Goods Orders for December from the Commerce Department.  Orders for goods meant to last more than three years were strong in October and November, lending credence to a strengthening manufacturing sector.

To a lesser extent, investors will be watching for Pending Home Sales (for December) and the Dallas Federal Reserve Manufacturing Survey (for January).

Tuesday

The S&P/Case-Shiller Home Price Index (for November) and Consumer Confidence (for January) from the Conference Board

Wednesday

Gross Domestic Product for the fourth quarter from the Department of Commerce.  As the widest gauge of the health of the economy, GDP is critical.  GDP grew by 2.7 percent in the third quarter.  JP Morgan holds one of the more optimistic predictions of 1.5 percent expansion for Q4.

The Federal Open Markets Committee will conclude its two-day meeting and deliver comments on its current monetary policy and interest rates.   Investors will be keen to any changes in plans related to quantitative easing that is ongoing to the tune of $85 billion per month.

Also, the ADP Employment Report (for December)

Thursday

Initial Jobless Claims for the week ended January 26 from the Labor Department.  In the last report, first-time filings for jobless benefits declined by 5,000 to a seasonally adjusted 330,000, marking the lowest level since January 2008.  It’s notable that jobless claims at the beginning of the year can be volatile due to the holiday season.

Personal Income and Outlays for December from the Department of Commerce.  Investors watch this closely as a barometer of consumer spending.

Also, the Chicago Price Manager’s Index (for December) from the Institute for Supply Management.

Friday

The Manufacturing Index for December from the Institute for Supply Management.  The monthly survey of purchasing managers provides a bevy of information on the strength of production, new orders, backlogs, inventories and more to gauge the strength of manufacturing in the country.  The index has been posting slow and steady gains for three consecutive months.

The Employment Situation for December from the Department of Labor.  A combination of two surveys in one comprehensive report, the employment situation is nearly as closely watched as the benchmark unemployment rate as a measure of the health of the nation.

Also, Consumer Sentiment (for January) from Reuters/University of Michigan, Motor Vehicle Sales (for December) and Construction Spending (for November) from the Commerce Department.