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Traders are expecting the action on Wall Street to be mild in the holiday-shortened coming week, with the European Union referendum -- and its effect on the currency market -- the only event threatening to raise pulses.

The euro is trading near seven-month lows against the dollar, near $1.25, as concerns mount about France's rejection of the EU constitution in Sunday's referendum. Traders have amassed the largest short position on the euro since 1999 ahead of the vote, which could lead to severe currency volatility on both sides of the Atlantic.

"There is a huge short-euro, long-dollar position out there, so you are going to get a strong reaction no matter how the vote is decided," says Randy Diamond, sales trader at Miller Tabak. Diamond says the pressure on the euro could very well lead to a fierce short squeeze.

Fifty-five percent of French voters rejected the constitution Sunday. The euro fell against major currencies Monday morning in Europe, recently fetching $1.2502 in London, down from $1.2584 late Friday. It bought 134.83 yen, down from 135.79 Friday.

In terms of economic data, manufacturing and jobs will be the two biggest themes for the week.

"Manufacturing has been the part of the economy that's clearly been weakening," says Paul Mendelsohn, strategist at Windham Financial. "So it's important to see some stabilization in manufacturing data next week."

The Chicago PMI for May on Tuesday will be the first dose of manufacturing data traders receive after returning from their long weekends. Economists anticipate a reading of 62, down from April's 65.6.

Auto and truck sales for the month of May will be released on Wednesday. Analysts are looking for slight declines in both tallies. Also arriving on Wednesday are construction spending for April and the May ISM index, which economists expect to dip to 53 from 53.3 last month.

Thursday sees initial unemployment claims for the last week in May, productivity numbers for the first quarter and April factory orders. The consensus estimate for factory orders is 1.2%, a jump from just 0.1% in March.

Finally, nonfarm payrolls for May arrive on Friday. Economists are expecting 185,000 jobs to be added, down from April's surprising jump of 274,000. Analysts caution that if similar jobs surprises occur in the coming summer months, it could spur serious market movement due to the fewer number of traders stuck to their computer screens.

"Next week starts the light summer volume days, so volatility will be high," says Mendelsohn. "It won't take much to move the market when everybody is away."

Next week will be slow on the earnings front, with only a few notable names on the schedule.

On Tuesday, Irish airline



and chipmaker



report quarterly earnings.


Hovnanian Enterprises


is also scheduled to release its second-quarter earnings on Tuesday. Analysts are expecting the company to earn $1.61, up from $1.06 last year, on revenue of $1.27 billion. The consensus estimate for Hovnanian's full-year earnings is $6.94, a 30% increase over last year.

The short lineup on Wednesday, the first day of June, includes filter manufacturer





( ALOY) and

Mobile Telesystems



Communications provider

Comverse Technology

( CMVT) is also slated to offer first-quarter earnings on Wednesday after the bell. Analysts expect the company to earn 11 cents a share, up from 5 cents, on $266 million in sales.

Among the companies slated to report earnings on Thursday are

Take-Two Interactive Software











also will be stepping up to the plate on Thursday. The consensus estimate for the telecom equipment manufacturer's first quarter is a loss of 5 cents, better than the last year's loss of 9 cents, on revenue of $100 million.