Coming off the S&P 500's first weekly loss of 2013, stocks
have investors pondering the notion of a near-term decline. With
suddenly elevated headline risk, a deep pullback could be in
store. This week alone, investors will digest Italy's election
results and be forced to contend with the looming March 1
That is not all. This week's U.S. data points and earnings
reports have a significant retail bias, meaning that sector along
with the U.S. consumer will be in the spotlight. Consumer
confidence and new home sales data are due out Tuesday, followed
by the durable goods report on Wednesday. Thursday does not just
bring the weekly jobless claims number, but revised data on
Earnings, economics and international politics will see to it
that this week will not be short on excitement. With that in
mind, keep an eye on these
throughout the week:
iShares MSCI Italy Index Fund (NYSE:
) Arguably the most obvious ETF to be included in this week's
list, EWI has a big day week ahead of it. The term "inflection
point" is often overused on Wall Street, but with regards to the
lone Italy-specific ETF, that is an accurate way of describing
the current state of affairs.
Polls in Italy close at 9AM New York time Monday and the wild
card cannot be overlooked. In previous elections,
exit polls underestimated just how well then
Prime Minister Silvio Berlusconi was polling
This time around, markets do not want
want outright victory by Berlusconi
because that would likely lead to the unraveling of recently
implemented Italian austerity measures. A Berlusconi victory
would also be near-term problematic for the euro and could hasten
Italy's departure from the Eurozone.
SPDR S&P Retail ETF (NYSE:
) To say this week brings a deluge of retail earnings reports
might be an understatement. Lowe's (NYSE:
), Home Depot (NYSE:
), Target (NYSE:
), Gap (NYSE:
), Limited (NYSE:
), Best Buy (NYSE:
) and Kohl's (NYSE:
) are among the retail names stepping into the earnings
confessional this week, but that does not even complete the
XRT is almost an equal-weight ETF, so no single stock dictates
the fund's price action. However, combing all of the XRT
constituents that report this week leads to a decent chunk of the
ETF's overall weight. Combine that with the consumer-related data
points due out, and this is a week where XRT's long-standing
resilience could finally be tested.
SPDR Gold Shares (NYSE:
) Another obvious choice for this week's list, the world's
second-largest ETF by assets is in a precarious spot. The ETF,
backed by physical holdings of gold, has been taken to the
woodshed as gold futures have plummeted.
The situation extends beyond a mere pullback in gold prices.
Italy's election results could test the euro's resolve this week,
sending traders looking for a safe-haven in the form of the U.S.
dollar. Of course, that would imperil dollar-denominated gold and
could force GLD to violate critical support at $150.
Whether or not gold's bull run is officially over remains to
be seen, but the statistics for GLD are not encouraging. Since
the start of the year,
investors have pulled $3.1 billion from the
and last Wednesday was the worst one-day outflow from GLD in 18
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