The economic plate will be relatively empty to start the week as Wall Street looks to continue the rally to new highs from last week. The Dow Jones repeatedly set new records in the previous four days and the S&P 500 ended the week at its highest closing price ever of 1,551.18, although it is still 24.91 points short of the all-time peak of 1,576.09 in October 2007.
Economic drivers this week will include:
Retail Sales for February – The Commerce Department said last month that retail sales only nudged upward by 0.1 percent in January, in line with expectations, but the smallest gain in three months after 0.5 percent expansion in December. For February, economists are anticipating retail sales to expand stronger as consumers are becoming accustom to larger payroll taxes with increases of 0.5 percent projected for the month.
Initial Jobless Claims for the Week Ended March 9, 2013 – Last week, initial jobless claims and surprised all with new claims falling 7,000 to a seasonally adjusted 340,000 and the four-week moving average dipping to five-year lows of 348,750. Further the U.S. added 236,000 new jobs in February, according to the first estimate by the Labor Department, pulling the unemployment rate down to 7.7 percent from 7.9 percent in January. For the latest week, economists are expecting first time filings for jobless benefits to increase to 350,000.
Producer Price Index for February – The Bureau of Labor Statistics said that higher food prices drove the PPI higher by 0.2 percent in January from December, after three consecutive monthly declines. The increase was less than the 0.4 percent economists predicted. On a year-over-year basis, the PPI was up 1.4 percent in January. For February, economists are expecting a 0.6 percent hike in the PPI. The so-called “core” PPI, which excludes the volatile food and energy indices, is expected to increase by 0.2 percent for the month.
Consumer Price Index for February – The Labor Department reported that the CPI, which is a measure of a basket of services and goods bought by consumers and widely regarded as a gauge of inflation, was flat in January, mainly because lower gas prices offset gains in other areas. “Core” CPI, which eliminates food and energy costs, increased by 0.3 percent on the back of increased prices for airfares, clothing and hotel rates. For February, economists are expecting a sharp 0.5 percent increase in overall CPI and a 0.2 percent increase in core CPI.
Industrial Production for February – The Federal Reserve painted a mixed picture for industrial production in January. Manufacturing output, the largest component of industrial production, dropped by 0.4 percent, but was upwardly revised for the two prior months. For January, the Fed said that industrial production slid 0.1 percent in total, largely because of declines in auto production. For February, industrial production is expected to pick back up, with economists expected an increase of 0.5 percent in production and 0.3 percent in manufacturing.
Consumer Sentiment for March – The Thomson Reuters/University of Michigan Consumer Sentiment Index isn’t as heavy of a market mover as the above items on Friday, but it is still closely watched to get a feel for people’s feelings about their financial condition and attitude about the U.S. economy. In February, the index rose to a preliminary reading of 76.3, representing the highest level since November before climbing to 77.6 for the final February reading. Economists are not expecting much for the preliminary reading for March, with most expecting the index to remain basically flat.
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