Financial Markets Summary For The Week of October 20-24 2008

After the heaviest week of Fed talk and macro data releases in recent memory, the calendar will see a very light week of rhetoric and economic releases. Monday, will see the publication of the Conference Board's index of leading economic indicators, Thursday the weekly jobless claims data and the week will conclude with the publication of the September existing home sales.

Fed Talk

Ahead of the FOMC meeting on 29 October, the week will see a modest quantity of Fed talk. On Monday, Atlanta Fed President Lockhart will speak on the economic outlook and FRB Minneapolis President Stern will speak, topic TBA.

Corporate Earnings

The week will see a heavy slate of earnings announcements that will feature a large quantity of releases from financial firms. Monday will see announcements from American Express and Caterpillar. The following day will feature, United Healthcare, US Bancorp and M&T Bancorp. After market releases on Tuesday will see Yahoo, Black Rock, Apple and State Street. Heavyweights on Wednesday announcing earnings will be Boeing, Wachovia, McDonalds and Merck. Thursday will see Microsoft, Altria, UPS, Eli Lilly and Jet Blue all release earnings. The week will conclude with AMBAC and MBIA providing information on their bottom lines to the public.

Leading Economic Indicators (September) Monday 10:00 PM

The index of leading economic indicators should capture the recent turmoil in financial markets and provide a fairly bleak reading of the prospects for the US economy. Save, the increase in the money supply at the Fed every other leading indicator should be emitting negative signals for the US economy. We anticipate that the leading index will fall -0.4% for the final month of Q3'08.

Jobless Claims (Week Ending October 18) Thursday 08:30 AM

The impact of the twin hurricanes to hit the Gulf Coast this year on the claims series has begun to unwind and the adjustment within the initial claims looks to be just about finished. We expect that claims will increase to 470 for the week.

Existing Home Sales (September) Friday 08:30 AM

The market will observe some of the first hand data since the intensification of the credit crunch begin just over one month ago. The existing sale of homes, which has been in the process of stabilizing over the past few month's is poised to reap the benefits of the strong increase in pending home sales in August. Indeed our model confirms that data should confirm that. However, its is in our judgment that the rapid deterioration of conditions in the credit markets effectively shut down lending for part of the sampling period and this should adversely impact purchasing activity in September. Thus, we anticipate that jobless claim will decline to 4.70mln for the month of September.