Weekend Reading

Happy New Year, and welcome to Weekend Reading. As always, I've scoured the Web for articles and papers worth reading. First, however, a look back at the week that just finished, and a look forward to the week ahead.

It was another upbeat week on the major markets, a suitable end to what turned out to be a standout year. This past week the Dow and the S&P 500 gained 1.0% and 0.5%, respectively, while the Nasdaq Composite advanced 0.6%. It has been a real rocket ride, at least over the past six months. Click here for the weekly performance.

All of the major U.S. indices ended the year having logged double-digit gains. What's more, all 10 major industry groups in the S&P 500 finished the year on a positive note. But keep in mind that even though that index turned in a 14.1% performance, you would have done even better had you ventured outside the U.S. For example, Morgan Stanley Capital's international all-country index was up 19% in 2006.

Is the new year set for more of the same? Certainly there is fairly uniform bullishness out there, with strikingly similar elements in various bullish theses: low interest rates, a possible midyear rate cut and a resurgent technology sector. There does seem to be ample reason to expect solid performance in 2007, although nothing like the numbers we saw this past year. It also is likely that gains will be much more sector-specific, with technology doing well but energy and commodities failing to match this year's gains.

As for the coming week, the economic indicators to watch include the Institute for Supply Management's December manufacturing index. The ISM has delayed its release until Wednesday morning in observance of the national day of mourning for President Ford on Tuesday, when the markets will be closed. On Friday, we'll get the December nonfarm payrolls report from the government.

Turning to earnings reports, it will be pretty much dead quiet. There are only two major companies reporting next week: Monsanto(GOOG Quote) and Constellation Brands (STZ Quote).

Finally, here are some articles and papers worth reading:

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• U.S. stock market shrinks by $600 billion in 2006. (MarketWatch)
• IPO market looks set for more strength in 2007. (MarketWatch)
• The art market is hotter than ever. (Financial Times)
• EIA does its year-in-review look at U.S. energy markets. (EIA)
• Bill Miller's streak of beating the S&P 500 ends at 15 years. (The Washington Post)
• Elder-care costs are cutting retirement savings of a generation. (The New York Times)
• Holiday spending estimates are coming down quickly. (AdAge)
• Christmas is over, so let the sales angst begin. (Bloomberg columnist Caroline Baum)
• How business has trounced the trial lawyers. (BusinessWeek)
• Barron's picks Great Plains, tech, and emerging markets, but pans AT&T. (Barron's)
• Ten percent of TV will soon be watched over the Internet. (Telegraph)
• Global house prices are still rising. (Financial Times)
• Housing bears may just have it right for 2007. (Bloomberg)
• Bullish mood for 2007 has some people feeling bad. (Bloomberg)
• Gift cards -- more than 40% of which are never used -- are becoming an even bigger business. (The Washington Post)
• Jim Rogers thinks agriculture, not commodities, is the place to be in 2007. (Globe and Mail)
• Is it time to add a parking lot to your portfolio? (The New York Times)
• Research: The impact of hurricanes on international financial flows. (NBER)
• Research: Interesting papers on financial globalization. (BIS)