Besides monitoring the US debt ceiling talks, investors had quite a bit of economic data to sift through last week. The US trade gap increased 15 percent in May to $50 billion. It’s highest level since October 2008. Small business optimism dipped in June as business owners expect weaker sales and consumer prices fell in June because of lower gas prices. In the week ahead, investors expect a slew of earnings reports from the likes of Xerox, American Express and Apple — as well as reports on housing and the economy.
We’ll get two reads on housing. First up is the June housing starts report. In May, new construction rose 3.5 percent after plunging the previous month and building permits — a gauge of future building activity — also rebounded by 8.7 percent — to a level not seen since December.
We also expect the June existing home sales report which looks at previously owned homes. In May, sales dipped nearly 4 percent, the second straight month of decline, suggesting a sluggish housing recovery.
Is the economy improving? We’ll find out with the June leading indicators report — which tracks activity such as manufacturing, new claims for jobless benefits and stock prices – the may report showed a nearly 1 percent gain, boosted by improved consumer sentiment and fewer claims for unemployment benefits.