May 21: Greek Tragedy May Remain in Focus
The weekend G-8 summit’s supposed commitment to keep Greece within the Euro-zone may not amount to much in the absence of a favorable outcome from that country’s fresh elections next month. But media reports appear to indicate that support for the centrist conservative party, which failed to get a majority in this month’s election, to be improving. That said, it is too complicated for outsiders like us to try to handicap the Greek political scene. But irrespective of how the Greek story unfolds, it promises to remain the dominant theme for global markets in the coming days.
We don’t have much on the economic docket today and the items on deck for the rest of the week are also relatively light weight. And with the Facebook (FB) IPO now behind us, we don't even have that to look forward to. We don't have much in terms of catalysts to reverse the persistent stock market slide of the last few weeks.
Housing will be in focus this week, with the Existing Home sales for April on Tuesday and New Home sales on Wednesday. Last week’s better than expected Housing Starts and Homebuilder Sentiment survey are pointing towards favorable momentum on the housing front. Expectations are for this week’s New and Existing Home sales reports to reverse the March declines and show solid growth rates. Housing aside, we will get the April Durable Goods report on Thursday and the weekly Jobless Claims data that same day. The University of Michigan Consumer Sentiment survey for May, coming out on Friday, is expected to flat from its last reading.
The first quarter earnings season is effectively over, though we do have a handful of key reports still to come before we can ‘officially’ close the books on the reporting season. Of this morning’s basket of reports, Loews (LOW) came out ahead of expectations, but its outlook for the year is underwhelming. Campbell Soup (CPB) beat on EPS, but its revenue numbers came in lower than expected. Other major earnings reports this week include Best Buy (BBY) and Dell (DELL) on Tuesday and Hewlett-Packard (HPQ) on Wednesday.
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