Last Week's Headlines

• Sales of existing homes fell off a cliff in July. The National Association of Realtors said closings on home resales were 27.2% in July. According to the National Association of Realtors®, that's the largest monthly drop since 1999, and 25% below the July 2009 figure. With a 12.5-month supply of homes for sale, more sales were made to investors (19%) though 38% of sales were to first-time buyers. All-cash sales increased to roughly 30% of total sales.
• Meanwhile, sales of new single-family homes hit their lowest level since the start of record-keeping in 1963. The number sold--276,000 on a seasonally adjusted annual basis--was 12.4% below the June level.
• The second quarter gross domestic product (GDP) figure was revised downward to 1.6% from 2.4%. While that still represents growth, it's substantially below the first quarter's 3.7% increase.
• Federal Reserve Chairman Ben Bernanke described some of the measures the Fed is prepared to take if the economy worsens, including additional purchases of long-term bonds, lowering the interest rates the Fed offers banks, and raising the Fed's unofficial 1.5%-2% inflation target. While acknowledging that the economy had slowed in recent months, he forecast stronger growth in 2011 would likely make those measures unnecessary.
• The Securities and Exchange Commission approved a regulation giving investors the right to have their own candidates for corporate boards of directors appear on the same proxy ballot as the company's own nominees. Investors must have held at least 3% of a company's stock for at least three years to take advantage of the provision.
• Durable goods orders were up 0.3% in July, according to the Commerce Department. However, not counting the purchase of large aircraft, the figure, which is often volatile, is almost 4% lower than in June.

Eye on the Week Ahead

Despite what is likely to be continued light trading volume because of the upcoming holiday weekend, traders still working will be looking toward Friday's jobs report. Minutes of the Federal Reserve's recent meeting also will be watched.

Key data releases: Personal income/spending (8/30); home prices, FOMC minutes (8/31); U.S. manufacturing, construction spending (9/1); pending home sales (9/2); unemployment/payrolls, U.S. services sector (9/3).

Data source: Includes data provided by Brounes & Associates. All information is based on sources deemed reliable, but no warranty or guarantee is made as to its accuracy or completeness. Neither the information nor any opinion expressed herein constitutes a solicitation for the purchase or sale of any securities, and should not be relied on as financial advice. Past performance is no guarantee of future results.

The Dow Jones Industrial Average (DJIA) is a price-weighted index composed of 30 widely traded blue-chip U.S. common stocks. The S&P 500 is a market-cap weighted index composed of the common stocks of 500 leading companies in leading industries of the U.S. economy. The NASDAQ Composite Index is a market-value weighted index of all common stocks listed on the NASDAQ stock exchange. The Russell 2000 is a market-cap weighted index composed of 2000 U.S. small-cap common stocks. The Global Dow is an equally weighted index of 150 widely traded blue-chip common stocks worldwide. Market indexes listed are unmanaged and are not available for direct investment.