Cannon Trading Futures Blog: Daily Support and Resistance Levels

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=DJ UPDATE:US DATA WEEK AHEAD: Housing,Durable Goods Data Top Wk

07/21/08 10:32

   (Updates consensus for jobless claims, Reuters/Michigan sentiment and new home sales)

   By Deborah Lynn Blumberg

   Of DOW JONES NEWSWIRES

  NEW YORK (Dow Jones)--The data calendar slows down this week, with the first few days largely devoid of key economic figures. Thursday and Friday, though, offer the potential for some data-driven market moves, with housing, durable goods and consumer sentiment figures all on tap.

   Durable-Goods Orders Seen Softening In June

  Demand for durable goods in May was flat, better than the 0.5% drop that had been expected. For June, the median expectation of economists surveyed by Dow Jones Newswires is for a drop of 0.5%. The Commerce Department is set to release the June durable-goods orders data at 8:30 a.m. EDT (1230 GMT) on Friday.

  There are several economists though who are looking for a rise in durable-goods orders, especially after the prior month's surprise. Economists at Lehman Brothers in New York expect durable goods orders to have increased by 0.3%. Capital goods demand "has remained remarkably resilient this year despite a less friendly growth outlook and tighter financial conditions," they said. "Indeed, the stability of core shipments contrasts markedly with the steep declines witnessed in the 2001 recession.

  "While we continue to expect a contraction in investment spending this year," they added, "it looks likely that the declines will remain shallow, helping overall activity avoid a sharp downturn.

   July Consumer Sentiment Likely To Slip

  July's preliminary Reuters/University of Michigan consumer sentiment reading rose marginally, but at a level of 56.6 sentiment was still left hovering near a 28-year low.

  The reading is expected to tick lower amid renewed financial market stress and a still-weak labor market.

  Economists surveyed by Dow Jones Newswires see the index for the month falling to a final reading of 56.3. The final July consumer sentiment data are set for release at 9:55 a.m. EDT (1355 GMT) on Friday.

  Consumer sentiment has nosedived from where it was around this time last year. The end-July 2007 reading was at a lofty 90.4.

  "While crude oil prices have eased somewhat recently, gas prices climbed higher in early July and the stock market has decreased over the survey period," said economists at Barclays Capital.

  "Together with the ongoing deluge of negative media headlines, we think it is likely that sentiment declined for the month as a whole," they said.

   June Home Sales Seen Declining

  Both new- and existing-home sales are seen falling in June. The National Association of Realtors' existing-home sales data are scheduled to be released Thursday at 10 a.m. EDT (1400 GMT); new-home sales data from the Commerce Department are due Friday at 10 a.m. EDT (1400 GMT).

  Economists are looking for existing-home sales to fall 0.8% to a 4.95 million annualized rate from the prior 4.99 million.

  For new-home sales, economists anticipate a 1.4% drop to 505,000 from the prior 512,000, as mortgage rates rose in June and with financial market distress likely contributing to dour consumer sentiment and keeping buyers at bay. In June, the homebuilder sentiment index moved to the lower end of the relatively narrow 18 to 20 range that has prevailed for the past 10 months.

  "Home sales may be stabilizing, albeit at low levels," said economists at Nomura Securities. "However, much higher sales volumes will be necessary to enable builders to reduce the heavy supply of unsold homes. Until those stocks are substantially reduced, home building will remain weak."

   Other Data:

  -The Conference Board's index of leading economic indicators, released Monday morning, fell by 0.1% in June to a reading of 101.7.

  -Jobless claims for the week ended July 19 are expected to rise to 380,000 from the previous week's 366,000. "The seasonal adjustment difficulties that have held initial unemployment insurance claims down for the past two weeks should start to fade this week," said analysts at Wrightson ICAP. The "zig-zag pattern" in continuing claims should lift the series back to its highs for the year, they added. A 3.2 million reading in continuing claims would be consistent with a renewed increase in the jobless rate for the month, they said. The Labor Department is scheduled to release the data Thursday at 8:30 a.m. EDT (1230 GMT).

  -By Deborah Lynn Blumberg, Dow Jones Newswires; 201-938-2018; deborah.blumberg@dowjones.com

  Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/al?rnd=a5vGVuLsIGAVkKlM6fBhyw%3D%3D. You can use this link on the day this article is published and the following day.

  (END) Dow Jones Newswires

  July 21, 2008 11:32 ET (15:32 GMT)

  Copyright (c) 2008 Dow Jones & Company, Inc.