Weekly Market Commentary

Highlights: Earnings have mattered a lot for the U.S. stock market. Over the past three years, earnings are up about 58% and the S&P 500 is up about 55%.

Highlights: January’s employment report, one of the best in many years, found that the private sector added 257,000 jobs and the unemployment rate dropped to 8.3%.

Highlights: The upcoming Super Bowl will test the stock market’s historical correlations with the calendar and events that proved rewarding to investors in 2011.

Highlights: S&P’s downgrade overshadowed meaningful developments over the past two weeks in Europe which we would call an upgrade in dealing with the debt problems. 

Highlights: This week is the start of the fourth quarter 2011 earnings reporting season with big, well-known companies like Alcoa and JPMorgan Chase due to report fourth quarter results.

Highlights: The purported end of the world falls exactly one year from this Wednesday, December 21, 2011. Like a primeval Y2K event, 2012-ers believe that one year from now the earth will experience a catastrophe or an enlightenment.

Highlights: The weaker pace of productivity in recent years could mean slower profit growth
ahead for S&P 500 companies.  

Highlights: Europe’s leaders have seen the ghost of Christmas Past (2008), Present (Greece, etc.) and Yet to Come (break up).

Highlights: A full slate of European government bond auctions this week may reveal whether the recent rise in yields is sufficient to entice investors into European government bonds.