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It's about prices and the price of oil in the coming week.

"Everybody will be focused on oil next week. However, the market has shown an uncanny ability to rally on higher oil prices for the past two years," says Ken Tower, chief market strategist for CyberTrader.

Tower suggests that the conventional wisdom that higher crude prices will knock down stocks "has been and will continue to be wrong." Oil prices have more than doubled over the past two years, setting record highs last week in the mid-$60 range. The

S&P 500



is up more than 25% over the same period.

It's not the price of oil but the pace at which it ascends that is worrisome to investors, says Randy Diamond, sales trader at Miller Tabak. Diamond estimates that every $1 move in oil equals a $7 billion hit to the economy. That's nearly $70 billion in the last month, outpacing income growth, which runs about $50 billion a month.

"Oil at $70 or $80 sounds scary, but it's how fast we get there that is the key," says Diamond.

On Tuesday, investors will be able to see if higher energy costs are pushing up prices across the board when the July consumer price index is released. Economists expect the CPI to rise 0.4%, up from a flat reading last month. The core CPI, which excludes food and energy costs, is expected to rise 0.2% from 0.1% in June.

Housing starts and building permits for July also will be released on Tuesday. The consensus estimate for new houses being constructed is 2.03 million for July, up from 2 million in June.

The producer price index will be released on Wednesday. The market is expecting an increase of 0.5% for July after seeing no change in June. Economists are looking for the core PPI for July to jump 0.1% from a negative 0.1% in June.

"If the rise in energy causes the CPI and PPI to come in stronger than expected, then it will undoubtedly revive discourse about the


plans for interest rate hikes," says Jason Schenker, economist at Wachovia. "So yields could spike, which would be negative for stocks."

On Thursday, leading economic indicators for July are expected to rise 0.2% from 0.9% the prior month, while economists expect the Philadelphia Fed survey to rise to 12 in August from 9.6 in July.

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also reports on Monday. Analysts expect the retailer to earn $1.02 a share, up from 87 cents last year, on revenue of $11.81 billion.

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is also scheduled to report on Tuesday. The consensus estimate for the world's largest retailer is 65 cents a share, up from 62 cents last year, on $77.4 billion in revenue.

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Companies reporting on Thursday include


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reports Thursday as well. Analysts expect the retailer to earn 24 cents a share, up from 29 cents, on $2.24 billion in revenue.