@ Wall Street
Progress in the negotiations over raising the debt limit and a new bailout package for Greece gave U.S. stock markets a small lift this week. The news from the housing front was mixed. Existing home sales slipped and single-family permits were flat in June, but the FHFA house price index for May rose for the second straight month and multi-family housing permits reached their highest level in June since October 2008. Other releases in a week that was light on data releases were also mixed.
The key release in the upcoming week will be will be a very disappointing second-quarter GDP report. We expect growth to come in at 1.6%, down from 1.9% in the first quarter, on a sharp slowdown in real consumer spending. On the housing front, we anticipate a flat reading on new home sales for June. Durable goods orders will be down in June on lower aircraft orders.
The two key yardsticks used to measure the consumer?s moods, the University of Michigan's index of Consumer Sentiment and the Conference Board?s Consumer Confidence Index, should both be up?but from low levels. Finally, the employment cost index for the second quarter will show no signs of wage inflation.
