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Trading Radar: Fed Speakers Likely to Cause Market Volatility

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Economics, earnings reports, and market events for the week ahead.

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The craziness that was this week extended into Friday. Deleveraging continued on Friday but was mostly contained after articles were released from Fed leakers at Market News International (Beckner) and the Wall Street Journal (Hilsenrath). On Friday, China stepped in to unfreeze the Chinese credit markets by injecting $65 billion of cash, which temporarily allowed capital to begin flowing again. Governments in Turkey and Brazil stepped in for the second day in a row to inject cash into their respective foreign exchange markets. Lastly, the emerging market carry trade unwind continues to wreak havoc in bond markets as liquidity became an issue on Friday.

Given the volatility caused by Fed comments in the last 72 hours, the large number of Fed speakers should also cause volatility at the end of next week. On Thursday and Friday, Federal Reserve Governors or Board Members Lacker, Pianalto, Williams, Dudley, and Lockhart will make speeches, and each word has the potential to move markets. The reaction to Fed Chairman Ben Bernanke's post-meeting speech this past Wednesday has created a rapid repricing in the rates market, which has spread chaos throughout the market as a whole.

Next week will be busy on the US economic data front. Manufacturing data in the form of durable goods orders, home price data from Case-Shiller, new home sales data, and personal spending data will be released. The home sales data will be interesting as it is from May and thus far home sales data has been decent despite a massive spike in mortgage rates during the month. Personal consumption data for May will provide the clearest picture on the direction of consumer spending; after two months of slowing gains in March and April, inflation may have picked up in May, coincident with a rise in producer prices.

Global economic data is rather muted for the week. The UK will release the final estimate of first-quarter GDP on Thursday. Before the market opens on Friday, Japan will release consumer inflation, industrial production, and employment data. Lastly, Germany will release its employment data for June on Thursday.

Earnings will pick up this week with Lennar Corporation (NYSE:LEN), General Mills, Inc. (NYSE:GIS), Nike, Inc. (NYSE:NKE), and Barnes & Noble, Inc. (NYSE:BKS) reporting.


Monday, June 24

US Economics (Time Zone: EDT)

08:30 Chicago Fed National Activity Index – consensus 0.00, prior -0.53
10:00 Dallas Fed Manufacturing Index – consensus -1.8, prior -10.5
11:00 Fed buying $4.75b-$5.75b notes in 5 to 6-year range
11:30 Treasury selling $30b 3-month bills, $25b 6-month bills

Fedspeak:

10:00 Fisher in London

Global Economics (Time Zone: GMT)

09:00 EUR German IFO Expectations

Earnings

No major earnings scheduled.


Tuesday, June 25

US Economics (Time Zone: EDT)

08:30 Durable Goods Orders YoY – consensus 3.0%, prior 3.3%
08:30 Durable Ex Transportation YoY – consensus 0.0%, prior 1.3%
08:30 Capital Goods Orders Non-Defense, Ex-Aircraft – consensus 0.6%, prior 1.2%
08:30 Capital Goods Shipments Non-Defense, Ex-Aircraft – consensus 0.8%, prior -1.5%
09:00 S&P/Case Shiller 20 City M/m, April, consensus. 1.2% prior 1.12%
9:00 FHFA House Price Index, April, est. 1.1% prior 1.3%
10:00 Richmond Fed Manufacturing, June, est 0 prior -2
10:00 Conference Board Consumer Confidence, June, est.75.5 prior 76.2
10:00 New Home Sales, May, est. 460k prior 454k
10:00 New Home Sales M/m, May, est. 1.3% prior 2.3%
11:00 Treasury to purchase 1.25b-1.75b bonds in 23-30 year range
11:30 Treasury to sell 25b 52week bills, 4-week bills
1:00 Treasury to sell 35b 2 -year notes

Earnings

Apollo Group (APOL)
Barnes & Noble (BKS)
Lennar (LEN)
Walgreen (WAG)


Wednesday, June 26

US Economics (Time Zone: EDT

7:00 MBA Mortgage Applications, June 21 prior -3.3%
8:30 GDP Q/q, 1Q final, est. 2.4% prior 2.4%
8:30 Personal Consumption Expenditures, 1Q final, est. 3.4% prior 3.4%
8:30 GDP Price Index, 1Q final, est. 1.1% (prior 1.1%)
8:30 Core PCE Q/q, 1Q final, est. 1.3% (prior 1.3%)
11:00 a.m.: Treasury to purchase $2.75b-$3.5b notes in 7 to 10-year range
1:00 p.m: U.S. to sell $35b 5-year notes

Fedspeak:

10:00 Fed's Fisher, Lacker testify on financial regulation to House Financial Services Committee

Global Economics (Time Zone: GMT)

06:00 EUR German GfK Consumer Confidence Survey
06:45 EUR French GDP

Earnings

Bed Bath & Beyond (BBBY) is expected to report EPS of $0.93.
General Mills (GIS) is expected to report earnings per share of $0.54.
Herman Miller (MLHR) will release its earnings report.
Monsanto (MON) is projected to report earnings per share of $1.6.


Thursday, June 27

US Economics (Time Zone: EDT)
8:30 Personal Income, May, est. 0.2% prior 0.0%
8:30 Personal Spending, May, est. 0.3% prior -0.2%
8:30 PCE Deflator M/m, May, est. 0.1% prior -0.3%
8:30 PCE Deflator Y/y, May, est. 1.1% prior 0.7%
8:30 PCE Core M/m, May, est. 0.1% prior 0.0%
8:30 PCE Core Y/y, May, est. 1.1% prior 1.1%
8:30 Initial Jobless Claims, June 22, est. 345k prior 354k
8:30 Continuing Claims, June 15, est. 2.96m prior 2.95m)
10:00 Pending Home Sales M/m, May, est. 1.0% (prior 0.3%)
10:00 Pending Home Sales Y/y, May (prior 13.9%)
11:00 am: Kansas City Fed Manufacturing Activity, June, est.3 prior 2
11:00 a.m.: Treasury to purchase $4.25b-$5.25b notes in 5 to 6-year range
1:00 p.m.: Treasury to sell $29b 7-year notes

Fedspeak:
10:00 a.m.: Fed's Dudley speaks on labor market in New York
10:30 a.m.: Fed's Powell speaks on monetary policy inWashington
12:30 p.m.: Fed's Lockhart speaks on economy in Marietta, Ga.

Global Economics (Time Zone: GMT)

Japanese Purchases of Foreign Bonds and Stocks
01:30 CNY Industrial Profits
08:30 GBP Great Britain GDP
07:00 EUR Spanish Retail Sales
07:55 EUR German Employment Change
09:00 EUR Consumer Confidence

Earnings

Accenture (ACN) is expected to report EPS of $1.13
Conagra Foods (CAG) will release earnings.
KB Home (KBH) is expected to report EPS of -$0.05 for the quarter.
Nike (NKE) will be reporting earnings.


Friday, June 28

US Economics (Time Zone: EDT)

9:00 NAPM-Milwaukee, June, est. 45.2 prior 40.67
9:45 Chicago Purchasing Manager, June, est. 55.0 prior 58.7
9:55 University of Michigan Consumer Confidence, June final, est. 83.0 prior 82.7
11:00 Treasury to purchase $1.25b-$1.75b debt in 2036-2043 sector

Fedspeak:
8:00 Fed's Stein speaks on monetary policy in New York
9:15 Fed's Lacker speaks on economic outlook in White Sulphur Springs, W. Va.
12:00 Fed's Pianalto speaks on monetary policy inWheeling, W. Va.
3:30 p.m.: Fed's Williams speaks on monetary policy in Sonoma, Calif.

Economics (Time Zone: GMT)

JPY Employment
JPY Industrial Production
JPY CPI
JPY Retail Trade
JPY Housing Starts
01:30 AUD Private Sector Credit Growth
06:00 EUR German Retail Sales
06:00 GBP Nationwide Home Prices
12:00 EUR German CPI

Earnings

No major earnings scheduled.


Twitter: @MichaelSedacca

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