CMC Markets Weekly Report

Stocks in the US finished higher for a fourth straight day on Friday. The gains came at the end of a day in which the major indexes traded in a narrow range in large part because of the Federal Reserve's decision late Thursday to raise it's discount rate to 0.75%. The Dow Jones industrials closed up 9 points to 10,402. The blue chips opened sharply lower, and then recovered to a gain of 46 points before slipping. The Nasdaq added 2 points to 2,244. The S& P 500 Index rose 2 points to 1,109.

This week in Australia will see a large amount of economic data. This Monday we will be looking out for the vehicle sales for January. On Wednesday we have December's conference board leading economic index, the construction work done in the 4th Quarter, and December wage costs numbers. Of most interest nevertheless will be Thursday's fourth quarter private capital expenditure figure. This number will give us an indication of whether businesses are now more confident to invest in new plant, equipment and projects. On Friday we will see January private sector credit. This number will give us a key indication of whether the appetite for borrowing at both the business and consumer level is on the rebound, and whether mortgage demand is still strong now that government incentives have been reduced.

It's a busy week offshore as well. On Friday we will see the first revisions to both the UK and US fourth quarter GDP estimations. The UK's first estimate was 0.1% growth, and economists expect that figure to be revised upward given 0.4% growth was previously expected. The first estimate in the US was for 5.7% growth, the consensus expects that number to be slashed on the first revision.

This week is a big one for housing in the US, as the Case-Shiller house price index, the FHFA house price index, and sales data for new and existing homes will all be released. The Dallas and Chicago Fed regions will update economic activity, and two measures of consumer confidence will be provided. New durable goods orders will be a highlight on Thursday. Also this week the US Treasury will auction more debt in the form of two-year, five-year and seven-year notes and thirty-year inflation-adjusted bonds. The auctions total US$126bn of face value.

This week in Australia features the final and by far the busiest week of the February reporting season. Among the bigger names posting their interim results will be Amcor, Suncorp-Metway, Lend Lease, Perpetual, Woolworths, Toll Holdings and Harvey Norman. OZ Minerals, Woodside Petroleum, GPT Group, Aristocrat Leisure and Oil Search will be reporting their full-year results.