Last week, it was all about the Federal Reserve Board. This week, Wall Street's attention focuses squarely on inflation. In fact, there are three key reports due out this week that should shed light on wholesale and retail price trends. If those reports show that prices are rising faster than expected, the same investors who called on the Fed to stop lifting rates could be clamoring for the Fed to raise rates once more in September.
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Monday, August 14:
EARNINGS TO WATCH: Agilent Technologies, Dillard's, HealthSouth, and Warnaco Group
Tuesday, August 15:
WHOLESALE INFLATION: The Labor Department will unveil its July producer price index, a key gauge of wholesale-level inflation. If the PPI report comes in hotter than anticipated, expect a sell-off in equities, as investors will figure that the Federal Reserve will turn around and raise interest rates again to fight rising prices.
EARNINGS TO WATCH: Abercrombie & Fitch, American Eagle Outfitters, Deere & Co., Home Depot, Pep Boys, PetSmart, Saks, Staples, UBS, and Wal-Mart Stores
Wednesday, August 16:
RETAIL INFLATION: This morning, the Labor Department will report on new trends in retail inflation when it releases the July results of the consumer price index.
HOUSING STARTS: How cool is the housing market getting? Wall Street finds out this morning when the Commerce Department reports on July housing starts.
CAPACITY UTILIZATION: The Federal Reserve will report on how much of the nation's total factory capacity was being utilized last month. The less slack there is in the economy, the more likely inflation will rear its ugly head.
EARNINGS TO WATCH: Hewlett-Packard
Thursday, August 17:
LEADING ECONOMIC INDICATORS: The Conference Board will release the latest results of its closely watched index of leading economic indicators.
EARNINGS TO WATCH: China Mobile, Dell, Gap, and Nordstrom
Friday, August 18:
CONSUMER SENTIMENT: The University of Michigan will release the latest results of its closely followed consumer confidence survey.
EARNINGS TO WATCH: Ann Taylor Stores, Foot Locker, and J. M. Smucker Co.
