We will get another look at initial third-quarter results with 11 S&P 500 companies reporting. Included in this group are AutoZone (AZO), Bed, Bath & Beyond (BBBY), General Mills (GIS), KB Home (KBH), Lennar (LEN) and Paychex (PAYX). A total of 33 companies are on the calendar.

The Fed will hold a 2-day meeting starting on Tuesday. No change in rates is expected at either this or the November meeting. Traders will be looking for insight about the pace of recovery and updates on the various bailout programs.

In addition to the Fed meeting, the economic calendar features August Leading Indicators and home sales data.

Monday: August Leading Indicators Tuesday: Federal Housing Finance Agency (FHFA) House Price Index Wednesday: FOMC rate decision (about 2:10 pm), weekly crude inventories, weekly mortgage applications Thursday: August existing home sales, weekly initial jobless claims, weekly natural gas inventories Friday: August new home

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It's a relatively quiet week on the earnings front with only 50 companies scheduled to report, including a smattering of retailers and food companies. Only 2 S&P 500 members are on tap to report including Campbell Soup Co. (CPB) and National Semiconductor (NSM).

The economic calendar is also quiet to start the first "real" trading week in September, as Wall Street comes back from August vacations. It's a shortened trading week due to the Labor Day holiday on Monday.

Monday: Markets closed for Labor Day Tuesday: ICSC-Goldman Store Sales, Redbook Wednesday: Beige Book Thursday: International trade, weekly jobless claims, weekly natural gas inventories, weekly crude inventories Friday: Import and export prices, University of Michigan consumer sentiment survey for September, Treasury budget Volume is likely to return to more "normal" levels to start the week. Despite recent weakness in the markets, the bulls remain in charge. Wall Street will also be watching trading

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The $300 Trillion “Money Bang” Keith Fitz-Gerald and his team have just produced a groundbreaking report that shows how this historic “Money Bang” is gaining steam. You’ll find out why China is investing $200 billion in one company – and why it’s expected to gain 356%… Why the Dept. of Energy is “backing” one solar company – and why it’s 506% revenue jump is a “smidgen”… And why one recently IPO’d water company is headed for a 600% run. Just go here for details.

With unemployment hovering at 9.4% consumers continued to show reluctance in July as incomes stagnated. Furthermore, with the jobless rate expected to exceed 10% later this year, consumer confidence fell in August, keeping hopes of a sustained economic recovery at bay.

Purchases rose 0.2% in July, the Commerce Department reported Friday. However, that increase was largely the result of the government’s Car Allowance …

U.S. stocks gave up most of their gains on Friday after initially spiking to 10-month highs as weak consumer sentiment data offset an upbeat forecast from chipmaker Intel and better-than-expected profit from computer maker Dell.

A Reuters/University of Michigan survey showed consumer confidence fell to its lowest in four months in August on worries over high unemployment and dismal personal finances, though the mood improved from earlier this month.

The Nasdaq was buoyed after Intel Corp raised its outlook for third-quarter revenue and Dell Inc , the world’s No. 2 personal computer maker behind Hewlett-Packard Co , posted a strong quarterly performance and several brokerages raised their price target on the stock.

The PHLX semiconductor index <.SOXX> rose 2.2 percent, while Dell shot up 4 percent to $16.29, and Intel increased 4.6 percent to $20.36.

“You would think after the Intel blowout numbers the market would have really picked up a lot of steam,” said Angel Mata,

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European shares touched a 10-month high on Friday on optimism for a global economic recovery and with Nokia and results from U.S. bellwethers boosting the technology sector.

The FTSEurofirst 300 <.FTEU3> index of top European shares rose 1 percent to 978.34 points. Over the week, the index climbed 1.2 percent, its sixth weekly gain in the last seven weeks.

The European benchmark index is up more than 51 percent from its lifetime low of March 9, as investors have become more confident on the prospects of economic recovery.

“Things look good for the time being, but the higher we go the more we could be setting ourselves up for a disappointment,” said Andy Lynch, a fund manager at Schroders.

“The world economy is doing well, French and German GDP are positive, but that’s not surprising given the amount of stimulus being pumped into the market. I have a concern about what happens when the sugar

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The dollar edged up against the euro and yen on Monday in extremely thin trade as Wall Street surrendered earlier gains and traders repositioned themselves ahead of U.S. consumer and housing data due this week.

Solid U.S. and euro zone data and an upbeat assessment on the economy from Federal Reserve Chairman Ben Bernanke over the weekend earlier pushed investors to take on riskier investments at the expense of the the low-yielding yen and dollar.

“Conventional wisdom suggests that major currencies should trade within their recent ranges until liquidity improves after the Labor Day holiday,” said Wells Fargo currency strategist Vassili Serebriakov. “However, there is plenty of data in the U.S. and elsewhere to change that this week, with consumer-related numbers likely to be watched closely.”

Investors are looking ahead to upcoming U.S. and European data to confirm hopes that the world economy is improving.

The dollar was last up 0.1 percent at 94.49

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The U.S. unemployment rate slipped to 9.4% in July from 9.5% in June, the most encouraging sign yet that the U.S. recession is easing.

But the news – released in a government report Friday – isn’t all good: Unemployment is likely to remain high in the months to come as some of these encouraging indicators of new economic growth evolve into a painful jobless recovery.

Friday’s jobs report and other recent data “reinforce our view that the U.S. recession ended in June, and we have raised our third-quarter 2009 growth forecast to 3.5%,” Christian Broda, a Barclays Capital (NYSE ADR: BCS) economist in New York, wrote in a research report yesterday.

Alan Krueger, the U.S. Treasury Department’s top economist, said he thought forecasts that growth would resume this year were “plausible” but expressed concern about long-term unemployment, which remains as a nagging problem.

“The administration is constantly looking

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The U.S. unemployment rate slipped to 9.4% in July from 9.5% in June, the most encouraging sign yet that the U.S. recession is easing.

But the news – released in a government report Friday – isn’t all good: Unemployment is likely to remain high in the months to come as some of these encouraging indicators of new economic growth evolve into a painful jobless recovery.

Friday’s jobs report and other recent data “reinforce our view that the U.S. recession ended in June, and we have raised our third-quarter 2009 growth forecast to 3.5%,” Christian Broda, a Barclays Capital (NYSE ADR: BCS) economist in New York, wrote in a research report yesterday.

Alan Krueger, the U.S. Treasury Department’s top economist, said he thought forecasts that growth would resume this year were “plausible” but expressed concern about long-term unemployment, which remains as a nagging problem.

“The administration is constantly looking

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Joshua Tucker, a political science professor from NYU and blogger at the Monkey Cage, has this opinion piece in the New Republic:In short, little related to this war has changed; despite the Russian military victory, neither side can really claim to have gained much. So what are we to make of the conflict? Four explanations for why the war occurred seem plausible. First, it may have been a "mistake" on Georgia's part. It's possible Saakashvili guessed wrong, thinking he could grab South Ossetia and get back under the West's protection before Russia did anything. Second, the war may have been a "mistake" on the part of a Russia determined to remove Saakashvili from power. Perhaps Moscow underestimated what the international community's reaction would be and/or overestimated the capabilities of the Georgian opposition to Saakashvili. Third, as I have suggested previously on this website, the war ...

For Immediate Release

Chicago, IL - July 6, 2009 - Zacks.com releases the list of companies likely to issue earnings surprises. This week's list includes Alcoa (AA), Family Dollar (FDO), Pepsi Bottling Group (PBG) and 3Com (COMS). To see more earnings analysis, visit http://at.zacks.com/?id=3207.

Every day, Zacks.com makes 4 stock picks available, free of charge. To see them, go to http://at.zacks.com/?id=5612.

This Week's Events

Second-quarter earnings season "officially" starts on Wednesday afternoon with Alcoa's (AA) report. The aluminum producer is expected to have lost 34 cents per share.

Joining AA will be 19 other companies, including Family Dollar (FDO) and Pepsi Bottling Group (PBG).

Analysts are forecasting a 21% drop in median S&P 500 earnings. The actual decline could be far smaller, especially given that 18 of

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