Tuesday
Economic Reports: Consumer Confidence, Case-Shiller Home Price Index

I expect the Consumer Confidence report to beat expectations based on the Michigan Sentiment report from last week and improving Personal Income. There is a growing consensus that the worst in the economy may be past us. However, the Case-Shiller Home Price Index will likely show continued deterioration in the housing market. Until foreclosures slow, prices will continue to drop.

Wednesday
Economic Reports: ISM Index, Pending Home Sales

The ISM Index report is expected to show a slight improvement since last month. The index is slowly making its way towards the magical reading of 50, which would indicate expansion of the manufacturing sector. If this report disappoints, and the Factory Orders on Thursday do as well, it could be tough going for the market.

Pending Home Sales are also expected to post a slight improvement since last month. I don’t think this report will beat expectations. All the housing reports last week fell below expectations, I think this one will follow suit.

Thursday
Economic Calendar: Factory Orders, Non-Farm Payrolls

As with the ISM Index, there is a possibility of some encouraging news in the manufacturing sector. If the both the ISM Index report and the Factory Orders report meet expectations, there could be a real turnaround afoot in the manufacturing sector. The industry is not yet out of the woods, but production should start improving..

Expectations are for another 370k jobs lost this month, continuing the string of consecutive months. While the market expects losses, if the report comes in much worse than expected, and the other reports I have highlighted fall below expectations, the market could get crushed.