Fib Levels: 1403,1390,1382,1369(H),1364,1360,1358,1355,1352,1347,1334,1326,1313,1291,1256

De Mark: 1366,1357,1345
Weekly: 1392,1380,1344

S&P:
R:1390,1380,1373
Pivot: 1360
S:1351,1338,1329

German DAX:
Pivot-point: 6468
Support: 6361,6306,6199

Calendar:
10AM Wholesale Inventories

Headlines:
-European macro in-line
-Germans delay vote on ESM
-Greeks are still trying to form government -Risk assets under pressure at the time of writing

Markets look to be in for a rocky Monday! French and Greek elections do not go as planned for the powers that be. The Greek situation could deteriorate by the day as a coalition government looks very difficult to piece together. Japan has opened down 2% as it plays catch up after being close for much of last week. The Euro has cracked the $1.30 level. S&P futures are down over 1%, and Crude is down over 2%. Who will come to save the day? After all the patchwork quilt of government intervention which has already been performed, will the global central banks sit by without trying to keep risk assets propped up? The Europeans have seen their grand plans ripped apart by a European Spring of epic proportions. We will have to watch how this develops. Earnings will continue in earnest as macro data is a touch on the light side this week, although there are several European debt auctions on the agenda. Stay alert, technical’s are falling across the most assets and lows not seen in months are being tested. Could this get really sloppy real fast or will the global central banks act to help stabilize the uncertainty, both politically and financially which has been let loose on the markets? This could be interesting to watch. Have a wonderful week ahead.

Sunday:

* Heavy dose of Australian Data will kick off the week

Monday:

* Swiss Unemployment, FX Reserves & CPI data
* Euro Zone Investor Confidence -14.7 prior
* German Factory Orders -6.1% prior
* 8:30AM Canadian Building Permits
* 3:00PM US Consumer Credit $10B est. versus $8.735B prior
* Fed Governor Lacker will speak after bell
Earnings of Note: CTSH,PETS,CAR,FTR,SYY,LPX,DISH,TW,CDE,DNDN,NLS,RAX,VVUS,JMBA,PBI,REN & GA

Tuesday:

* German Wholesale Prices & Industrial Production -1.3% prior
* Italian & Belgian debt auctions
* Canadian Housing Starts
* 12:45PM Fed’s Fisher
* Overnight New Zealand Card Spending
Earnings of Note: HBC,STO,DNB,MR,SEED,DISCA,IVR,GTY,AER,DTV,CRZO,WEN,STWD,THC,PPS,GET,PCX,RAIL,TAP,HL,CQB,GFF,JAZZ,XOMA,DIS,XL & MRX

Wednesday:

* Japan Leading/Coincident Index estimates 96.9/95.6
* German Import/Export & Trade Balance Data
* German, Swiss & Italian debt auction
* 7:00AM US Mortgage Applications
* 10:00AM Wholesale Inventories 0.6 est. versus 0.9% prior
* Kocherlakota, Pianalto & Plosser
* Overnight: Japanese Bank Lending, Current Account & Trade Balance data as well as Aussie Employment 5.2%
Earnings of Note: WFR,AOL,MPEL,TEVA,DTG,EOG,FCN,HMY,M,PL,KRQ,ES,SPB,DF,FLL,CSCO,DLGC,NWS,PCLN,BMC,LYV & TSLA

Thursday:

* Chinese Trade Balance, Import/Export data; $7.9B, 9.1% & 12.5% estimates
* UK Industrial Production -2.3% YoY
* Bank Of England Interest Rate Decision – unchanged
* 8:30AM US Trade Balance -50B vs -46B prior
* 8:30AM Initial/Continuing Jobless Claims
* 9:30AM Bernanke Speaks
* 10:00AM UK GDP
* 1:00Pm Kocherlakota
* 2:00PM US Monthly Budget
* Overnight: Chinese CPI, PPI, New Loans, Money Supply, Industrial Production & Retail Sales
Earnings of Note: BID,JWN,BWC,KSS,WIN,GEN,WR,MTL,SPP,HWCC,OAK,PEIX,APEI & NUAN

Friday:

* German CPI 2% YoY prior
* UK PPI
* Italian Debt Auction
* 8:30AM US PPI 0.0% est.
* Canadian Unemployment
* 9:55AM University of Michigan Consumer Confidence 76.4 est.
Earnings of Note: AGO,DAR,KCAP,PAL,CECO,RNF,BREW,RTK & NVDA

Headlines have been coming fast and furious once again. Unfortunately mostly of the negative variety. The market still hangs in tough. The next two sessions will be big for the markets. Tomorrow the European Central Bank will meet to render a decision on interest rates. Mr. Draghi will be in the spotlight in a big way. The split on the council is growing deeper as some want the central bank to act further, while the more hawkish, see old Budesbankers, want the member states to work through their problems, individually. What to do? On top of this rate decision, the Spanish will auction some newly minted paper. Since the ECB cannot participate in the new issue, will Mr Draghi show up on the buyside ahead of the sale? There was some talk today that the ECB was doing some probing, but nothing definitive was ever confirmed or denyed. There has also been talk the EU may loosen up collateral rules for the Spanish banks to help them free up some cash in the near future. Again, this was not confirmed or denyed at the time of writing. The French will also head to market tomorrow with some new paper. With elections Sunday, the political drama in country may be more exciting then the fiscal turmoil, although that could change abruptly. US data remained negative on the headline. Some will site the revisions in the Factory Orders data as a positive, depending on which camp you live, is the glass half full or half empty? Because of some of the weakening data points which have been rolling off of the presses, many sell side firms have been revising GDP estimates, today we saw Nomura do just that. Overnight tomorrow the Chinese PMI data will highlight, which will lead us straight into Non Farm Payroll data on Friday. Also, Friday PMI services data will be released across the Euro Zone. So as you can see turning a blind eye to the markets the next two days could be dangerous! Have a wonderful afternoon.

Tough day to get excited about the market action, although down a mere 30 points could be seen as a victory considering the headlines. The German DAX is registering its first monthly loss this year, as it went out on the lows of the day. The situation in Spain has cast a dark cloud over the Union and its ability to work out of the current problems. As noted yesterday in our weekly preview, the political union is being buffeted by political infighting across many of the member states. Spain has followed the UK back into a recession according to economists and recent data points. US data was nothing to write home about as well. Chicago and Dallas Fed manufacturing data both came out below consensus estimates. The S&P has traded in a tight 8 point range at this time. Our high was a touch below Friday’s high and our low has been a touch below Friday’s low. There is still a long way to go until the end of the day. Hard to call them lower highs and lower lows at this point in the day, but you are getting the picture. Overnight tonight should focus on the Royal Bank of Australia’s Interest rate decision where a ¼ point cut is expected. At this point not sure how the risk assets will take the trimming by the RBA. Capitulation, or a sign that another central bank is willing and able to try and get that bubble reflated at all costs. Tomorrow we will get some key PMI data points out of Ireland and the UK. The US will focus on ISM Manufacturing data as well as Construction Spending. Earnings reports will remain heavy.

How much longer can the markets ignore the political skirmishes which are taking place globally? The bulls will site the de-coupling of US and Europe. Plus add in the ultra loose policies of the Fed, and corporate buybacks as causes for helping keep a bid under our markets. But reading the press over the weekend one has to wonder when the political backlashes over austerity taking place across Europe, permanently damages the Union. The Romanian government has fallen. The Czechs are looking over the edge of the abyss. The Irish who have been held up as a good example of choking down bad medicine has watched as anti-austerity Sinn Fein has risen quickly up the polls. The most pressing problem seems to be between the French and the Germans. The Merkozy partnership looks to be increasingly a love affair of the past, and a MerHollande love affair will not take its place anytime soon. The French Socialist was quoted in the press as saying; “Its not Germany that decides for the whole of Europe.” The honeymoon is over before the first kiss. Even the technocrat in Italy has questioned how austerity and austerity alone can help pick Europe up by its boot straps. This situation only seems to have the potential to get worse before it gets better as elections across the continent will be coming fast and furious. If you remember correctly the political gamesmanship in the US has been cited as the leading cause for our sovereign debt to get the axe last year. How much longer will it take for the rating agencies to question the political stomach for righting the financial ship across Europe? Will European yields fall if and when the AAA’s start to get trimmed? I would think not, which will only lead to further funding problems in the future. When will the ECB take one on the chin for the sake of the Union? What effect will that have on their credibility in the marketplace? Here in the US the campaigning is well underway and the governing will take a back seat here as well. It will have to be seen if the political union can survive outright political disunity. We have a busy week on tap. Non-Farm Payrolls here in the US on Friday can embolden the QE camp. PMI data across the globe. Several interest rate decisions, including one by the ECB. Paging Mr Draghi. Apple had another tough weekend as the NY Times has questioned their financial three card monty they are playing. Makes you wonder who or what will try to get their tentacles on the $110 billion in cash. Mr. Cook may be facing a challenge that cannot be easily swept under the mat by releasing Iphone or Ipad 10. Have a wonderful week ahead.

Sunday:
New Zealand Business Confidence, Building Permits and Trade Balance
South Korean Industrial Production
Singapore Unemployment

Monday:
Italy Money Supply & CPI data 3.2% prior
Spanish Current Account & GDP data -0.5% estimate
German Retail Sales 1% vs -1.1%
Euro Zone Flash CPI YoY 2.5% vs 2.6% prior
Portuguese Industrial Production -6.8% prior
8:30AM US Consumption, Core PCE deflator, Personal Income and Spending(0.27/0.33) & Retail Sales revisions
9:45AM Chicago PMI 60.5 prior
Chinese Manufacturing PMI 53.6 vs 53.1 prior
Overnight- Dutch PMI, South Korean PMI, Indian PMI & RBA Interest Rate Decision
Earnings of Note: NYX,WPI,HUM,TEN,WDR,HAR,L,UDR,LYB,AWI,CLD,MCK,MOH,PCL & CSE
Conferences: S&P Housing, RBC Global Financial, & Milken Institute

Tuesday:
Irish PMI Manufacturing 51.5 prior
Brazilian PMI Manufacturing est. 51
UK PMI Manufacturing 50.75 est.
Canadian PMI Manufacturing 52.4 prior
10AM US ISM Manufacturing 52.5 vs 53.4 prior + Construction Spending
Chinese HSBC Manufacturing PMI 48.3 prior
Williams, Lockhart and Plosser Speak
Earnings of Note: CPO,MAS,SIRI,ADP,DPZ,HUN,MPC,POZN,VLO,WPP,HCP,PFE,SPAR,EMR,AVP,CBOE,CBS,ADM,RATE & ONE

Wednesday:
Brazilian Trade Balance
German Unemployment 6.7%
Swiss Retail Sales -0.5% vs 0.8% prior
Spanish, Italian, French, German, & Greek PMI Manufacturing data
UK Mortgage Approvals
Euro Zone Unemployment 10.85%
Irish Unemployment 14.3% prior
Portuguese Debt Auction
7AM US Mortgage Applications
8:15AM ADP Claims 173.3K
10AM Factory Orders -1.5% vs -1.3% prior
Lacker speaks
Overnight New Zealand Unemployment & Chinese Non-Manufacturing PMI 58 prior
Earnings of Note: MAC,UBS,AUY,CMCSK,CVS,BZH,DDR,GGP,ICE,SPW,PHH,BMR,CLX,CHK,GNW,ABX,MRO,MA,MTOR,SUN,V & WTW

Thursday:
India PMI Composite 53.6 prior
Hong Kong Retail Sales 10.1%
UK Monetary Reserves and PMI services data
Euro Zone PPI 0.5% MoM
ECB Interest Rate Decision – no change expected – Draghi press conference following
Spanish and French Sovereign Debt Auctions
Brazilian Industrial Production 2% YoY
7:30AM Challenger Job Cuts
8:30AM Non-Farm Productivity -1 vs 0.9% prior, Initial/Continuing Jobless Claims & Unit Labor Costs 2.9 vs 2.8
10AM ISM Non-Manufacturing 55 vs 56 prior, New Orders 58.8 and Prices component 63.9
Williams, Lockhart & Plosser
Overnight- Chinese PMI – Composite 49.9 & Services 53.3 both prior
Earnings of Note: DHT,RDA,AMT,CAH,BEAM,BEE,CAH,DCT,FIG,ITG,KSWS,FUN,GM,TSO,IPI,VIA’B,ALL,HIG,KIM,SEE,TWO,HEK,SPWR & KFT

Friday:
Spanish, Italian, French, German and Euro Zone PMI Services – Flat to down data called for
Euro Zone Retail Sales -1.5% YoY, 0.0% vs -0.1% MoM
Irish Industrial Production -3.6% prior
Brazilian PMI Services 54 vs 53.8
8:30AM US Non-Farm Payrolls 8.25% vs 8.2% prior
Canada IVEY PMI 60.8 vs 63.5 prior
Fed Gov. Williams speaks
Earnings of Note: AIG,AON,SD,EL,ARI,CF,DRC,ITT,MTZ,MSG,MTW,PSA,SWN,MHK,ZINC,AIV & CHD

Eric J Schumacher

Market is currently sitting up 1 ¾% on the week, and it seems content to go out quietly at this time. The yield on the 10 year is down nearly 1% on the week and keeps finding a level around the 1.93% area. What has changed in the past week? Earnings continue to run at a strong pace. The situation in Europe has remained strained at best. Regime change. Goal lines being moved. The ECB remains on the sideline. Hopefully we will get some clarity in the next few weeks as elections in Greece and France may shed some light on the future direction of the common currency. The UK has slipped back into a recession. European equities closed out the week on a positive note, although they were slightly negative on the week for the most part. This in spite of the fact that Spanish sovereign ratings were slashed at S&P, late in the week and the watch remains with a negative bias. US data was mostly negative on the week, except for a few outliers. Once again the market has taken solace in the fact that the central banks of the world continue to print and threaten to print at reckless abandon to try and move the needle on economic growth. Today’s macro data in the US was mixed. University of Michigan Consumer Confidence came out at a 14 month high. Most components were better. GDP data came inline, although there is a divided opinion on the data point. The bulls will site consumption as a big positive. Let’s not forget the mild weather may have had a big effect on this underlying component. The inventory build may be sited as a glaring negative. Either way the White House has stated the GDP data is ‘encouraging’. I am not sure encouraging is a great adjective to describe 2.2% growth. Next week will be a heavy data week. Chinese as well as European PMI’s. US data will center attention on ISM Manufacturing, Retail Sales and Non-Farm Payrolls. One thought comes to mind as we close out the week, Can’t fight the FED, add in the BOJ,BOE,ECB,PBOC,RBA for good measure! Have a wonderful weekend.

No real bounce thus far in the equity world. Europe closed down toward the lows of the session, with the damage looking as follows; FTSE down 2%, DAX down 3.5%, CAC down 3% and Italy down 3.8%. Spain in particular is approaching levels last seen from the dark days of March 2009. All the jaw-boning, government intervention, and the alphabet soup of other programs not withstanding the current market turmoil. Is the current turmoil caused by a crisis in confidence or a lack of liquidity? This question may be what is keeping the ECB on the side lines as they feel they have done enough on the liquidity front. Question than becomes, how do sovereign nations win back confidence before it is too late? Tough to tell on that front. When the ECB or the EFSF does show up on the bid, did anything really change? Markets will read into it as such but the underlining problems will remain the same. Down 1% here in the States is looking like a victory at this point, as the major European bourses peeled through key levels like a hot knife through butter! Tomorrow we will get a full slate of data points globally. Europe will have their eyes firmly on the Euro Zone Industrial New Orders data, plus Italian and Spanish debt auctions. Get your helmets ready if they do not go well! Our esteemed ladies and gentleman at the FED will kick off their two day meeting. Unfortunately for the markets the Chairman will not speak until Wednesday to get the QE lovers stirred up once again! Pre-opening we will get Case-Shiller housing data; followed by 10AM with, Consumer Confidence, New Home Sales and Richmond Fed Manufacturing data. This market is once again looking like a batter facing two fast balls at one time. Which will it swing at first? Confidence is a hard thing to recover once it has been lost, FYI. Have a wonderful afternoon.