Weekend Reading: Spirits Are High

Good Sunday morning. Here are some articles and papers worth reading. First, however, a look back at the week that just finished, and a look forward at the week ahead.

The major markets all advanced again last week. We are at a four-year high on the Dow, with it gaining 1.5%, and the S&P 500 is doing almost as well, up another 1.6% this week. While the Nasdaq has some work to do to catch up, it too turned in a spirited performance this week, gaining 1.6%.Click here for the weekly performance.

All indications are that the five-week-old market rally will continue this coming week. Holiday sales started off strong, with most regions and companies reporting year-over-year improvements (albeit often on massive discounting). While the week will see considerable economic data, in the absence of a major change it is hard to imagine the market not reacting positively to all the recent good news in the economy, from individual companies to the indices themselves.

Turning to the economic week ahead, it is a busy one. We are due to see home sales data (which almost certainly will show weakening), plus consumer confidence figures (which should strengthen somewhat). We will also see retail sales, the Fed's Beige Book, as well as personal income data and the ISM's manufacturing index. Finally, we are due to get data on November jobs. As I said, a busy economic week is ahead.

Next week is fairly quiet on the domestic earnings front. There is a raft of earnings out from Canadian banks, plus a few others here and there, but the focus will be squarely on retail sales and economic data.

Finally, here are some articles and papers worth reading:

Editor's note: To access some of these stories, registration or a subscription may be required. Please check the individual links for the site's policy.

• Mixed reports for the first days of holiday shopping (The New York Times)
• Will the Oprah effect make up for RIM's miss in the current quarter? (The Globe and Mail)
• Hedge funds are planting the seed for future change by bringing majority voting to many companies (Reuters)
• Microsoft loses (at least) $71 on every Xbox sold (BusinessWeek)
• When will Google start buying companies and who will it buy? (BusinessWeek)
• China's current copper troubles and its lack of transparency in important markets remain tied (Bloomberg)
• Barron's is mostly about philanthropy, but it tips Mellon and Petro-Canada (PCZ Quote), while worrying about SanDisk (SNDK Quote) (Barron's)
• Pension funds are searching for a free lunch at hedge funds (The New York Times)
• Online dating companies, including Yahoo, are being accused of fraud and deception (Los Angeles Times)
• Currency traders can't learn from economists, but economists can learn from currency traders (The Economist)
• No more quarters of 3% GDP growth (The New York Times)
• Well-done interview with a bullish John Wilson of Morgan Keegan -- buy Biotech HLDRS Trust (BBH Quote) (Institutional Investor)
• Research: There is more risk and return persistence at hedge funds than most investors expect (SSRN)
• Research: The home information advantage in investing persists on the back of significant incentives (SSRN)
• Research: Central banker mumbling is an important part of monetary policy (Cambridge Working Paper)

1 What would best describe your stance heading into the coming week of trading? Bullish Bearish Neutral 2 Which of these sectors do you think is set to move up in the coming week? --Choose One--Aerospace and DefenseAirlinesAutomobilesBeverages and Food ProductsBiotechnologyCommercial BanksComputers and PeripheralsConsumer NondurablesEnergy Equipment & ServicesHMOs and HospitalsHomebuildingInsuranceIntegrated OilInternet, Software ServicesInvestment Bankers and BrokersMediaMultiline RetailPharmaceuticalsPrecious MetalsSemis, Semi EquipmentTelecom EquipmentTobacco and AlcoholWireless CommunicationsUtilities 3 Which of these sectors do you think is set to move down in the coming week? --Choose One--Aerospace and DefenseAirlinesAutomobilesBeverages and Food ProductsBiotechnologyCommercial BanksComputers and PeripheralsConsumer NondurablesEnergy Equipment & ServicesHMOs and HospitalsHomebuildingInsuranceIntegrated OilInternet, Software ServicesInvestment Bankers and BrokersMediaMultiline RetailPharmaceuticalsPrecious MetalsSemis, Semi EquipmentTelecom EquipmentTobacco and AlcoholWireless CommunicationsUtilities View the results without voting