Sunday, January 12, 2014

The Week Ahead: A rich stew of reports

A rich stew of economic reports tracks trends in areas important to traders.

Inflation or deflation: The producer price index will be released on Wednesday, and its more important cousin, the consumer price index, on Thursday, both at 8:30 a.m. New York time.

Consumers (that's us!): The retail sales report will be out Tuesday at 8:30 a.m., again attempting to answer the all important question, Are we ready to shop 'till we drop, thereby saving the economy from further ruin?

Real estate: Housing starts will hit the markets Friday at 8:30 a.m. Real estate is considered to be the basis of any economic recovery.

Factories: The industrial production report will be released, also on Friday, at 9:15 a.m.

A more general report, the Philadelphia Federal Reserve survey of conditions in the mid-Atlantic region, will be out on Thursday at 10 a.m. It is considered something of an avatar for the nation as a whole and so has a following.

Leading indicators (in descending order of importance):

The interest rate spread between 10-year Treasuries and the federal funds rate, reported continually during market hours.

The M2 money supply, at 4:30 p.m. Thursday.

The S&P 500 index, reported continually during market hours.

Average weekly initial jobless claims, at 8:30 a.m. Thursday. 

Building permits for new private homes from the housing starts report, at 8:30 a.m. Friday.

The index of consumer expectations from the Reuters/University of Michigan consumer sentiment report, at 9:55 a.m. Friday.

Other reports of interest:

Monday: The Treasury budget, showing the government's revenue shortfall, at 2 p.m.

Tuesday: Import and export prices at 8:30 a.m. and business inventories at 10 a.m.

Wednesday: The Empire State manufacturing survey of conditions in New York at 8:30 a.m., the petroleum inventories at 10:30 a.m.. and the Federal Reserve Beige Book, a narrative of conditions in each Fed region, at 2 p.m.

Thursday: The Treasury's international capital report, tracking foreign capital flows into and out of the United States, at 9 a.m. and the Home Builders' housing market index at 10 a.m.

Friday: The Reuters/University of Michigan survey of consumer sentiment, at 9:55 a.m.


How fleeting the glory! Fed Chairman Ben Bernanke gives a speech on Thursday, and it doesn't even appear on the Federal Reserve's "What's Next" calendar. Bernanke leaves office on Jan. 31. He will speak on challenges that central banks face. But still, he's not gone yet.

One Federal Open Market Committee member has a speaking engagement: Chicago Fed Pres. Charles Evans, on Wednesday.

Two alternates are making appearances: Dallas Fed Pres. Richard Fisher and Philadelphia Fed Pres. Charles Plosser, both on Tuesday.

And three others from among the Fed glitterati will take to the podium: Atlanta Fed Pres. Dennis Lockhart on Monday and Wednesday, San Francisco Fed Pres. John Williams on Thursday and Richmond Fed Pres. Jeffrey Lacker on Friday.

Analytical universe

This week I shall be analyzing new bull and bear signals among 3,469 stocks and exchange-traded funds that have some analyst interest. They are traded both on the major U.S. exchanges and over-the-counter. My universe is selected from small-cap stocks and larger, defined as market capitalization of $1 million and greater.

Trading calendar

By my rules, I'm trading February options for the short legs of vertical, diagonal and calendar spreads and covered calls, and for all legs of butterfly spreads and iron condors. I'm trading April options for single calls and puts as well as straddles. Shares, of course, are good at any time.

Good trading.

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