Market Happenings for Monday, May 29, 2012

Premarket, futures are up on hopes that Greece might avoid an exit from the eurozone. Gainers this morning include BTU, ANR, CNX, CHK and CLF while losers include WDC, FSLR, PBI, PRGO and AMT.

The Market

Polls published over the weekend suggest that the New Democracy party, which favors the austerity plan central to the European bailout that has kept Greece in the eurozone, has moved back in front of the anti-austerity Syriza party. The prospect that Syriza could lead a new government after the June 17 vote was one of the major factors to have worried markets in recent weeks.

Greece’s four major banks were able to recapitalize with help from a European bailout fund Monday. The recapitalization could allow them to get assistance from the European Central Bank and reduce the threat of a run on the Greek banking system.

Many people still believe Greece is close to leaving the eurozone, affecting neighboring economies in the process.

Spain is a worry on the health of its banking system, after some Spanish banks were downgraded Friday. The yield spread between Spanish and German debt reached the highest level since the creation of the euro.

Reports are due today on home prices and consumer confidence.

The Case-Shiller 20-city Index, which tracks home prices, is expected to have slipped 2.8% in March, after dropping 3.5% in the prior month.

UPDATE: U.S. home prices were unchanged in March, according to the S&P/Case-Shiller 20-city composite index. The three-month rolling index includes transactions that took place from January to March. Over the past 12 months, prices have fallen 2.6% as measured by the Case-Shiller index, which is now at a post-recession low.

Later this week we have the May jobs report and key readings on manufacturing and auto sales. Economists forecast that employers added 150,000 jobs in May, and that unemployment remained at 8.1%.

European stocks were mixed in midday trading and Asian markets ended higher.

2 For 1 Stock Split Announced, Payable 6/26/12 – Dollar Tree (DLTR).

Earnings Reports

Earnings reports (sorted by mkt cap): SAFM-Sanderson Farms (consensus $0.90), DRYS-Dryships (-0.05).

Financial Calendar

0745 ET ICSC (Int’l Council of Shopping Centers) weekly retailer sales.

0855 ET Redbook weekly retailer sales.

0900 ET Mar S&P-Case-Shiller Composite 20 U.S. home price index expected +0.2% m/m and -2.55% y/y, Apr +0.15% m/m and -3.49% y/y.

1000 ET May U.S. consumer confidence (Conference Board) expected +0.3 to 69.5, Apr -0.3 to 69.2.

1030 ET May Dallas Fed manufacturing activity expected 1.5, Apr -3.4.

1100 ET USDA weekly grain export inspections.

1130 ET Weekly T-bill auctions.

1600 ET USDA Crop Progress.

1630 ET API weekly U.S. oil statistics.

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