Monday, 7-26-10
LAST WEEK:
- The markets ended strong for the second week in a row. The S&P500 was up +3.5% for the week, showing gains for the second week in a row. Major companies, in general, were beating the earnings estimates, but not beating the revenues/sales estimates. The only tough day the markets had was on Wednesday when Fed Chairman Ben Bernanke acknowledged the economic recovery has weakened.
- President Obama signed the 2300 page Financial Regulatory Reform bill (FINREG) into law. Proponents say it will prevent another meltdown. Critics say the new costs charged to the financial industry will simply be passed on to customers, in effect increasing the cost of money for business to borrow.
- The Obama administration said they will allow the Bush tax cuts to expire at the end of the year, as planned.
- Congress approved another extension in unemployment benefits. Democrats criticized Republicans for not being compassionate and voting for it. Republicans criticized Democrats for ignoring their request to vote on legislation that would pay for the extension and not further increase the deficit.
- European bank stress test results were released. Seven of the 91 banks failed the test.
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THIS WEEK:
- The biggest news of the week comes out on Friday, when the preliminary number for Q2 GDP is released. Expectations are for GDP to drop from Q1’s +2.7% to +2.5%.
- June new home sales will be reported on Monday. A small increase from 300,000 to 311,000 is expected.
- July consumer confidence will be reported on Tuesday. A decrease from 52.9 to 51.0 is expected.
- The following companies report Q2 numbers this week: Corning, DuPont, Honda, Lockheed Martin, and Norfolk Southern.
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All the best,
Chris
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