Good Sunday afternoon, and welcome to another edition of Weekend Reading. First a look back at the week that just finished, then a look forward to the week ahead, and, lastly, a summary of articles and papers worth reading. It was another week of market advances, despite some wobbliness on the earnings front toward the end of the week. The Dow rose 4%, the S&P 500 gained 4.1% and the Nasdaq climbed 4.2%. All three major U.S. indices are now in the green for the year, which would have been a big surprise to most people back in March.
Looking forward to next week, we will likely see more of same. Investors are in the mood to ignore negative earnings news -- witness the reaction to Microsoft ( MSFT), UPS ( UPS) and others -- so there is a little reason to think that will change next week (although it will eventually correct). Investors also are in a relief-rally mood, one driven by the recovery of markets from the levels of March, but not driven by any consistent signs that the economy is set to return to historical levels of GDP growth. While we could see a faster recovery to those levels in emerging markets, that will not be the case in the U.S. and Europe. Turning to economic indicators, next week will bring data on new-home sales for June, the July consumer confidence index, durable goods orders for June and the first reading on second-quarter U.S. GDP. Investors will also pay close attention to Treasury yields amid a flood of new U.S. government debt.
As for earnings, oil companies will occupy a central position next week. We will see earnings reports from Exxon Mobil ( XOM), Valero Energy ( VLO), ConocoPhillips ( COP) and Chevron ( CVX). Disney ( DIS) will also sneak in a report. 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 each site's policy.
- The Leaner Baby Boomer Economy. (BusinessWeek)
- Barron's picks California muni bonds, Plantronics (PLT) and OSI Pharmaceuticals (OSIP) (Barron's)
- IMF Plans to Inject $250 Billion Into Global Economy. (IMF)
- A special report on the Arab world: Waking from its sleep. (The Economist)
- Ben Bernanke as the Great Preventer. (The New York Times)
- Clouds are gathering over the venture capital industry. (SiliconValley)
- The New Joblessness. (The New YorkTimes)
- This Week In Petroleum. (Energy Information Administration)
- Calif. officials concerned about new budget woes. (AP)
- The Great Earnings Illusion. (BusinessWeek)
- REIT investors move from fear to fundamentals. (Reuters)
- Kuwaiti financier in SEC lawsuit commits suicide. (Reuters)
- Off Clip-On Mosquito Repellent Attracts Swarms of Consumers. (Advertising Age)
- Things Can Always Be Worse: You Could Be in New Jersey. (The New York Times)
- Scientists Worry Machines May Outsmart Man. (The New York Times)
- California's tax system: Smoothly does it. (The Economist)
- Legacy Fight: Inside Bush and Cheney's Final Days. (Time)
- Citigroup (C) in $100 Million Pay Clash. (The Wall Street Journal)
- Rewriting History: Analyst estimates changing in databases. (Journal of Finance)
- Do Portfolio Distortions Reflect Superior Information or Psychological Biases? (SSRN)
- Vacant U.S. Homes Stats: The U.S. Has Room for U.K. (Infectious Greed)