The Week Ahead: Stronger than expected retail sales, lower inflation, high gas prices, falling real estate prices, and consumer sentiment dropping are the mixed bag of data investors are digesting with regard to market direction. Look for some clarity in reports this week. Industrial production numbers are out on Tuesday while Wednesday brings housing starts, the CPI, and oil & gasoline inventories. On Thursday the leading economic indicators and jobless claims numbers are released.

Stocks to Watch: Oracle Corp. (ORCL) offered $17 a share for BEA Systems (BEAS) but was rejected as inadequate as BEA's stock soared. McDonald's (MCD) is projecting higher 3rd quarter results and a sales increase of 6% as their results are due by Friday. Allegheny Technologies (ATI) broke sharply lower after cutting its 3rd quarter earnings target. Shares of Biogen Idec (BIIB) jumped sharply after the close on Friday when its board okayed management to explore the sale of the company.

Special Note: Profit expectations at the beginning of the 3rd quarter were expected to increased by 6% for S&P 500 companies but have since dwindled down to a decline of 1%. General Electric (GE) is a good barometer of the economy and their earnings were in-line. The five week rise in the markets has investors more confident the economy will avoid a recession, but the Fed is now unlikely to lower rates again later this month. The market hiccup and rebound last Thursday and Friday appear to be signaling a sharper decline coming.


Commentary provided by Barry Ward, Registered Principal, NobleTrading.com, Inc.

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