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Cliff Wachtel
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Cliff Wachtel, CPA, is currently the Director of Market Research, New Media and Training for Caesartrade.com, a fast growing forex and CFD broker. He covers a variety of topics including global market drivers, forex, currency hedged and diversified income investing, and is currently working on a... More
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  • COMING WEEK MARKET: Bearish Growing Contagion Threat Vs. Market Resilience & US Q2 Earnings 0 comments
    Jul 10, 2011 12:22 AM | about stocks: UUP, UDN, FXE, ERO, URR, ULE, EUO, DRR, FXA, FXB, FXC, FXD, FXF, FXEN, FXY, JYF, AUNZ, CYB, GLD, CNY, USO, DUG, USL, NBO, DBV, ICI, CEW, SLV, OIL, SPY, SDS, RSW, BXDC, SPXU, SH, DIA, EWC, EWA, TLT, XHB, ITM, IGOV, VGK, TBT, GSG, DBC, CORN, ICN, SZR, BZF, GRU, DAX, FRC, DB, SAN, BNO, ENI
     The below is a continuation of Part 1: Prior Week’s Lessons For Next Week: Seismic Shift In EU Debt  Risk

     

     

    Despite all the bad news last week, the coming week could provide excuses to rally if the EU can stay calm

     

    EU

     

    Debt Crisis Developments

     

    Further developments on the PIIGS debt crisis and how on earth the Troika will calm markets now that private bond holders are now officially no longer protected from losses.

     

    EU Bank Stress Tests

     

    With EU bank stress test data due to be released next week, the leaks begin, with bankers supposedly angry over their strictness and last minute changes. Banks in Spain, Germany, and Greece may have been selected to fail, to be as the sacrifices for the sake of retaining overall credibility for the tests, while a source per Reuters said 5 Italian lenders have passed. All of the major Irish banks currently in state receivership passed last summer’s tests. These were known to be lax, but markets rallied anyway.

     

    US

     

    Retail Sales

     

    After jobs, arguably the next most important monthly US report is retail sales, as consumer spending accounts for about 70% of US GDP. Granted, with employment getting worse, consumer spending should follow it lower. However, per the latest ICSC and Redbook retail sales reports, consumer spending is on the rise. The International Council of Shopping Centers said retail sales rose 6.9 % y/y in the month of June compared to 5.4 % in May. Johnson Redbook also reported a 0.9 % rise in chain store sales. If retail sales rebound next week, it could provide some bearish

     

     

    Q2 Earnings Season

     

    It officially begins this week. Here are a few key names that will likely garner attention.

     

    Monday: Alcoa (NYSE:AA) after market close

    Tuesday: None

    Wednesday:  Yum Brands (NYSE:YUM), Marriot Hotels  (NASDAQ:MAR), both after market close.

    Thursday:  Google (NASDAQ:GOOG) JPMorgan-Chase (NYSE:JPM) before open

    Friday:  Citibank (NYSE:C) before open

     

     

    As noted in Part 1, earnings seasons tend to be bullish events in the sense that they tend to provide at least a short term boost for stocks,  regardless of the underlying reality.

     

    Other Calendar Events

     

    Big Theme: Slew of China Data

     

    China will see a slew of data in the week ahead which includes the June trade balance, industrial production, retail sales, CPI, and most importantly 2Q GDP figures.

     

     

    Sunday

     

    ·         CNY: trade balance

    ·         EUR: Trichet Speaks

     

    Monday

     

    ·         AUD: home loans m/m

     

    Tuesday

     

    ·         JPY: BoE rate statement & press conference

    ·         EU: ECOFIN Meetings

    ·         GBP: CPI y/y

    ·         USD: Trade Balance, FOMC Meeting Minutes

     

    Wednesday

     

    ·         CNY: GDP q/y, fixed asset investment ytd/y, industrial production/y, NBS press conference, new loans, retail sales y/y

    ·         GBP: first time jobless claimant count

    ·         USD: Fed Chairman Bernanke testifies to Congress

    ·         NZD: GDP

     

    Thursday

     

    ·         USD: retail sales, PPI

     

    Friday

     

    ·         USD: CPI m/m, Empire State Manufacturing index, Preliminary UoM consumer confidence

    ·         EUR: Bank stress tests results

     

     

    DISCLOSURE /DISCLAIMER: THE ABOVE IS FOR INFORMATIONAL PURPOSES ONLY, RESPONSIBILITY FOR ALL TRADING DECISIONS LIES SOLELY WITH THE READER. IF WE REALLY KNEW WHAT WOULD HAPPEN, WE WOULDN’T BE TELLING YOU FOR FREE, NOW WOULD WE?

     

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