Big economic week ahead
by Peter Switzer
Tomorrow I head down to the Grand Central for share markets — the New York Stock Exchange or Wall Street as it is often called — and I’m hoping on a positive day with plenty of action as I’m interviewing the legendary floor trader, Art Cashin from UBS.
I wouldn’t want to ask him his age, but he has seen more of the ups and downs of the NYSE than most others left standing in the market. He has been pretty cautiously negative this year and so his attitude tomorrow is something I really want to gauge.
In the news
Right now, the direction of the market is a battle between an improving US economy and, once again, a Europe with too many debt question marks hanging over the likes of Ireland, Greece, Portugal and now Spain. We have also the stupidity spooking geopolitical types coming out of Korea, which cannot be easily dismissed with US naval vessels flexing muscles in company with their South Korean buddies.
Here in the US, the big story will be this Friday’s employment report for November but overall it’s a big show-and-tell week on the economics front.
Apart from assessing Black Friday’s retail sales, which was the Friday after Thanksgiving, there are consumer confidence, auto sales and monthly chain store sales out for inspection.
Santa Claus rally
How important will economic data be in determining whether we see a Santa Claus rally before 25 December? Very important!
Deutsche Bank chief US equities strategist, Binky Chadha, tips the S&P 500 could reach 1275 by year end, and he told CNBC that stronger US economic news will be the driver.
The S&P 500 finished the week at 1189.40 and so that would be a nice seven per cent rise if he’s right.
On Tuesday in the States, we could see the Bush tax cuts, which are due to expire at the end of the year, extended and that would help the market as well.
In the data department, there will be housing, factory and services readings on the economy and a whole lot more.
Interestingly, a colleague of mine based in San Francisco working for a big Aussie firm and whose job is to wine and dine US decision makers to use his firm’s services has turned positive this week. He has been a bear in my life with his regular emails but he now says he’s seeing the US economic worm turn and this guy is a good walking, talking ‘economic’ gauger of California, where he’s based.
California — the seventh biggest economy in the world! — has been a basket case post-GFC and so when it turns a lot of the US will turn with it. Last week, when I was in LA, the latest job figures for October showed a rise of 39,000 in job creation, which was the biggest increase since May 2006.
This could be a big week on Wall Street and I’m sure glad I will be here to cover it.
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Published on: Monday, November 29, 2010blog comments powered by Disqus