The Week Ahead: Dec. 24-30, 2012

December 23, 2012 08:25 PM
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via a special arrangement with Informa Economics, Inc.

Fiscal cliff | Farm bill | Holiday markets

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.

Senators will return to Capitol Hill or Thursday, and perhaps House members, pending any agreement regarding fiscal cliff issues – the potential item of the week. The farm bill will continue as a discussion point but the odds are overwhelming that an extension will have to be put together at this point.

President Obama and some lawmakers continue to hold out hope a compromise can be reached on preventing the mixture of tax increases and spending cuts scheduled to take effect next year. With the Senate and likely the House coming back on Thursday, that will compress action on the fiscal cliff and markets will be on edge, reacting to almost each development.

Senate Majority Leader Harry Reid (D-Nev.) announced that the Senate will consider legislation (HR 5949) to extend for five years the Foreign Intelligence Surveillance Act (FISA) Amendments Act of 2008. eid said there would be up to seven hours of debate on the bill, before senators will take a vote on final passage. Under a unanimous-consent agreement, four amendments will be in order, Reid said.

The Senate also plans to resume consideration of the Hurricane Sandy supplemental relief bill (HR 1). On Friday, the Senate agreed to close debate on a substitute amendment, but failed to waive a budget point of order which would have required an offset on the disaster funding in the bill.But leaders reached agreement to hold votes on up to 21 amendments to the Sandy relief bill.

The House floor schedule for the balance of the year remains murky after House Speaker John Boehner's (R-Ohio) “Plan B” proposal regarding a fiscal cliff compromise failed to garner enough votes Dec. 20 to pass in that chamber. Boehner and other House leaders have not said whether the House will return after the Christmas holiday, only that the House would return to work “if needed.” Boehner declined to rule out continued negotiations to reach an agreement before the end of the year.

Holidays will be a big focus with a shortened trading session on Monday for Christmas Eve and then markets will be closed for Christmas day on Tuesday. The rest of the week will be focused on economic data and especially the fiscal cliff. And trade action will take place in lighter than usual trading volume since it is a shortened trading week – the last one of the calendar year.

There are some economic indicators out this week, with Wednesday bringing the Case-Shiller home price index and the Richmond Fed survey. Thursday will see jobless claims, New Home Sales and Consumer Confidence info, with the week wrapping with the Chicago PMI survey and Pending Home Sales. End-of-year book squaring will also affect markets during the trading week.

For agriculture, the shortened week means an abbreviated trading session Monday, with grains closing at noon CT and livestock markets ending at 12:15 p.m. CT. All markets and government offices are closed Tuesday, Dec. 25, for Christmas. Normal trade will resume Wednesday, Dec. 26. Note: some Monday releases could be pumped to another day following an executive order making Dec. 24 a federal holiday. Friday brings the Weekly Export Sales report, pushed back to Friday with Christmas on Tuesday, and the quarterly Hogs & Pigs report.

Monday, Dec. 24
US markets close early for Christmas Eve.
Russia President Vladimir Putin visits India and hold talks with prime minister Manmohan Singh on trade, economic, energy, and cultural matters.The trip is postponed from early November.
Gulf leaders meet: The Gulf Co-operation Council holds its annual summit today and tomorrow in Manama, Bahrain’s capital. It brings together the United Arab Emirates, Bahrain, Saudi Arabia, Oman, Qatar and Kuwait. The Syrian conflict is likely to top the agenda.
Economic reports: Selected Interest Rates (Federal Reserve)
USDA reports:
Export inspections (AMS) | Poultry Slaughter (NASS) | Cotton Ginnings (NASS) (Some or all of these reports could be delayed due to an executive order making Dec. 24 a government holiday.)

Tuesday, Dec. 25
Christmas Day. Most markets across the globe are closed.

Wednesday, Dec. 26
Japan: Shinzo Abe, the leader of Japan's Liberal Democratic Party, is set to become the country's next prime minister. He will likely announce his new cabinet members. Japan’s parliament will formally endorse him as prime minister after his conservative Liberal Democratic party won almost 300 seats in the December 16 general election.
Markets are closed in the U.K., Canada, Australia, and Hong Kong for Boxing Day.
Economic reports: ICI weekly money market mutual fund data | MBA Purchase Applications | Weekly Mortgage Rates (Freddie Mac) | S&P Case-Shiller HPI | | ICSC-Goldman Store Sales

Thursday, Dec. 27
Congress: The Senate, and likely the House, return to focus on fiscal cliff issues.
Economic reports: Jobless Claims (Labor Dept) | Consumer Confidence | New Home Sales
Energy reports: Weekly Petroleum Status Report (EIA) | Weekly ethanol plant production (EIA) | Weekly National Petroleum Report (API).
Transportation: Grain Transportation Report (AMS).
USDA reports: Broiler Hatchery (NASS)

Friday, Dec. 28

Economic reports: Pending Home Sales Index | Chicago PMI
Energy reports: Weekly US underground natural gas stocks (EIA).
USDA reports: Export Sales (FAS) | Peanut Prices (NASS) | Peanut Stocks and Processing (NASS) | Quarterly Hogs and Pigs (NASS) | Vegetables and Melons Outlook (ERS)

NOTE: This column is copyrighted material, therefore reproduction or retransmission is prohibited under U.S. copyright laws.






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