Weekly Newsletter June 17th - June 23rd

Current Events: The U.S. indexes rebounded from a long, powerful downtrend with a positive showing last week. This is something that has been few and far between since early May, however with Greek elections nearing conclusion, direction on the euro-zone crisis may soon become much clearer for worried investors.

What to Look for This Week

There is no question that the U.S. economy has a multitude of negative signals. Almost everywhere you look weaknesses and uncertainty can be easily be seen even by the most novice of scrutinizers, whether its retail spending, manufacturing production, or consumer confidence, all signs point toward downward. However, most investors are now attempting to quantify how long such a downtrend can be expected. Due to the instability of the U.S. economy the FOMC is strongly expected to leave the Fed rate at the remarkably low 0.25%.

News Affecting the Markets

The much awaited election in Greece is nearing its end as ballots have been cast and most votes have been counted. Based on the early projections, the winner of Sunday’s critical parliamentary elections is the pro-bailout New Democracy party, which currently holds a narrow lead over antiausterity Syriza. Such a result should keep Greece in the euro zone if the conservative political party holds onto its lead and then can form a governing coalition.

Smart Investing

Closed-End Funds: Investors are very familiar with open-end mutual funds, portfolios of securities that offer diversification and professional management at a low cost even for smaller-sized investors. Closed-end funds differ from mutual funds in that once the fund issues shares, those shares are bought and sold in the open market; unlike a mutual fund, the closed-end fund does not itself stand ready to redeem shares from investors wishing to sell their shares. Closed-end fund shares have both a net asset value and a share price, and sometimes trade at discounts or premiums to net asset value. There are many types of closed-end mutual funds and focus on a wide variety of securities, including common stocks, preferred stocks, high-yield bonds, taxable and municipal bonds, and foreign securities. As with mutual funds, closed-end funds can add to the diversity of your portfolio. You might find that a closed-end fund has more potential for higher returns because of the relative small size of the fund, which gives the managers more options and leeway. However, be cautious as this can also lead to higher risk as well.

Earnings for the Week

Monday: No major earnings scheduled.

Tuesday: Barnes & Noble Inc (BKS), Discover Financial Services (DFS), FedEx Corp (FDX), Jabil Circuit Inc (JBL), Jefferies Group Inc (JEF), La Z Boy Inc (LZB) {After the close}

Wednesday: Bed Bath & Beyond Inc (BBBY) {After the close}, Goodrich Corp (GR), Red Hat Inc (RHT) {After the close}, Rosetta Genomics Ltd (ROSG), Sonic Corp (SONC) {After the close}, Steelcase Inc (SCS) {After the close}

Thursday: Carmax Inc (KMX), ConAgra Foods Inc (CAG), Oracle Corp (ORCL) {After the close}, Rite Aid Corp (RAD)

Friday: Carnival Corp (CCL), Darden Restaurants Inc (DRI)

* Earnings dates and times are subject to change

Economic Data this Week

Monday
NAHB Housing Market Index @ 10:00 AM for June (Est. = 28, Prior = 29)

Tuesday

Housing Starts @ 8:30 AM for May (Est. = 710K to 719K, Prior = 717K)

Building Permits @ 8:30 AM for May (Est. = 720K to 725K, Prior = 715K)

Wednesday

MBA Mortgage Index @ 7:00 AM for 06/16 (Est. = n/a, Prior = 18.0%)

Crude Oil Inventories @ 10:30 AM for 06/16 (Est. = n/a, Prior = -0.191M)

FOMC Rate Decision @ 12:30 PM for June (Est. = 0.25%, Prior = 0.25%)

Thursday

Initial Claims @ 8:30 AM for 06/16 (Est. = 380K, Prior = 386K)

Continuing Claims @ 8:30 AM for 06/09 (Est. = 3,250K to 3,278K, Prior = 3,278K)

Existing Home Sales @ 10:00 AM for May (Est. = 4.50M to 4.56M, Prior = 4.62M)

Philadelphia Fed @ 10:00 AM for June (Est. = -0.2 to -3.5, Prior = -5.8)

Leading Indicators @ 10:00 AM for May (Est. = 0.0%, Prior = -0.1%)

FHFA Housing Price Index @ 10:00 AM for April (Est. = n/a, Prior = 1.8%)

Friday
No major announcements.