Weekly Newsletter October 7th - October 13th

Current Events: The market's initial reaction to Friday morning's shocking news of an unexpected significant drop in the unemployment rate from 8.1% to 7.8% was not enough to sustain all three major U.S. indexes for the day; however, the economic report did produce enough firepower to keep all three indexes positive for the week.

What to Look for This Week

With the earnings of aluminum giant, Alcoa, set for announcement after the closing bell Monday the official start to another round of earnings will be underway. Popular names, such as JP Morgan Chase, Costco, and Chevron, are all scheduled to announce earnings this week. This earning season investors will be eager to see if stocks can support the recent gains witnessed as a result of the Federal Reserve's infusion of a third round of quantitative easing, more commonly known as QE3.

News Affecting the Markets

The Labor Departments jobs data released on Friday was welcomed with mixed reviews and debates surrounding the data have already ensued. While the unemployment rate is the lowest it has been since 2009, many discredit the progress as most of the 114,000 news which were created are government jobs. Although bullish investors have little to complain about at the moment as all three major U.S. indexes (the Dow Jones, Nasdaq, and S&P 500) are all quickly approaching towards 52-week highs.

Smart Investing

Commercial Mortgage Fine Print: Commercial mortgage loans are used when purchasing structures such as office buildings, apartment complexes, health care facilities and retail outlets. Whether interested in acquiring something as vast as a hi-rise tower or a more practical family-owned restaurant, typically additional funding is needed for buyers to complete the transaction. Similar in many ways to residential loans, commercial mortgages require far more paperwork and getting lost in the fine print becomes a greater risk. When applying for a commercial mortgage, make sure to ask about the Early Redemption Charge. Bear in mind, lenders make money off the interest on the loan. When the loan is repaid in full sooner than anticipated, the lender loses money. To avoid losing money, lenders often include an Early Redemption Charge which can amount to a substantial, one-time sum. If you discover an Early Redemption Charge in the fine print, try to renegotiate. Applying for a commercial mortgage means that you are about to make a serious investment. You have a right to ask questions, renegotiate more favorable terms and do whatever else you feel is necessary.

Earnings for the Week

Monday: Alcoa (AA) {after the close}

Tuesday: Chevron (CVX), YUM! Brands (YUM)

Wednesday: Costco Wholesale (COST), Host Hotels (HST), Progressive Group (PGR)

Thursday: Safeway (SWY)

Friday: JP Morgan & Chase (JPM), Wells Fargo & Co. (WFC)
* Earnings dates and times are subject to change

Economic Data this Week

Monday
No announcements scheduled.

Tuesday
No announcements scheduled.

Wednesday
MBA Mortgage Index @ 7:00 AM for 10/06 (Est. = n/a, Prior = 16.6%)
Wholesale Inventories @ 10:00 AM for August (Est. = 0.5% to 0.6%, Prior = 0.7%)
Fed Beige Book @ 2:00 PM for September

Thursday
Initial Claims @ 8:30 AM for 10/06 (Est. = 370K to 375K, Prior = 376K)
Continuing Claims @ 8:30 AM for 09/29 (Est. = 3275K, Prior = 3281K)
Trade Balance @ 8:30 AM for August (Est. = -$43.8B to -$44.6B, Prior = -$42.0B)
Crude Oil Inventories @ 11:00 AM for 10/06 (Est. = n/a, Prior = -0.482M)

Friday
PPI @ 8:30 AM for September (Est. = 0.5% to 0.8%, Prior = 1.7%)
Michigan Sentiment @ 9:55 AM for October (Est. = 78.5 to 80.0, Prior = 78.3)