The market managed to end the week on a high note, reversing course from the week’s initial tumble, pivoting in the middle of Wednesday’s action to finish Friday 0.6% above the prior Friday’s final trade. It wasn’t exactly the ideal recovery move though. Volume was light on the way up – and getting lighter – and we’re still just one bad headline away from being in the trouble it looked like we were in a week a half ago.

Still, momentum is momentum.

We’ll weigh it all below, as always. First, however, let’s run-down last week’s economic news and talk about how this week’s economic announcements could rock the market.

Economic Data

There was more than a little economic news unveiled last week, not a great deal of it was hard-hitting. We’ll stick with the highlights, beginning with Wednesday’s retail sales numbers. They were up, with or without cars. They were up, in fact, much more than expected. Consumerism not only remains strong, but is accelerating.

Retail Sales Charts  

Source: Thomson Reuters

That same day we also got the Federal Reserve’s capacity utilization and industrial productivity figures for July. They were also good, though not quite as good as expected. Whatever the case, the bigger trends for both remain positive, and the year-over-year comparisons prove increasingly difficult simply because we’re now comparing results to previously-strong results. The trajectory is the key here, and the trajectory is bullish.

Industrial Production and Capacity Utilization Charts    

Source: Thomson Reuters

Finally, last month’s housing starts and building permits were up, though in neither case were up as much as hoped. And, this is the one place where we desperately needed some new life. The pace of homebuilding has been slowing for months, but has pretty much hit a will as of three months ago.

Housing Starts and Building Permits Charts