It could have been worse. Though the market didn’t log any meaningful gain last week, it didn’t lose ground either. Nevertheless, stocks ended last week on a low note, pointed lower and beneath some key lines in the sand. And, there was certainly no lack of volume behind the selling – a LOT of people are starting to have second thoughts about how much they really want to be exposed to stocks.

It’s not an invalid concern, though it would also be wrong to suggest that any further downside from here would be the beginning of a bear market. It would just be a normal, garden variety correction (but a correction nonetheless).

Even then, however, this erratic market may find a way of sidestepping that selloff in front of the usual bullishness we see during the last couple months of the year.

We’ll weight it all, right after a recap of last week’s economic news and a preview of this week’s economic announcements.

Economic Data

If a score had to be assigned to last week’s economic reports, it wouldn’t be a good one. Although we’ve seen worse, the overarching message was that consumerism growth is slowing down.

The week kicked off with a look at last month’s retail sales, though a footnote needs to be added before looking at the data. The touted number fell, when stripping automobile sales out of the equation, but that was a month-to-month figure. On the far-more-meaningful year-over-year front, spending continues to rise. It’s not rising as fast as it was, but the comparables are getting much tougher now in that they’re up against the earliest part of a spending revival.

Retail Sales Growth (Annualized) Charts

Source: Thomson Reuters

The good news is, the nation’s factories are as busy as ever. The Federal Reserve’s capacity utilization and industrial production were just as high (if not higher) in September than they were in August.

Industrial Production and Capacity Utilization Charts

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