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 Through Thursday's close, the S&P 500 was held to its narrowest
trading week since Thanksgiving as investors dealt with uncertainty
regarding a forward path for the economy and a deal for Greek debt.
Late on Friday, the European Union agreed to a four-month extension
for Greece, and a late rally pushed the S&P 500 above technical
resistance level of 2,100 after several failed attempts earlier in
the week.
The index was up modestly for the week, building on a 5-percent gain
over the prior two weeks.
"The market has done quite well this week holding things together,"
said Frank Cappelleri, technical market analyst and trader at
Instinet LLC in New York.
"You have a holiday-shortened week, you have low volume, you have
people probably taking a step back and deciding what we have here –
do we push higher at this point, or do we need some of the extended
areas pull back to a greater degree?"
With worries about Greece taking a backseat, traders next week could
focus on the slew of expected economic data, including several
reports on the housing market, consumer confidence, the consumer
price index and the preliminary fourth-quarter reading on gross
domestic product.
The data will give investors fuel to speculate on the timing and
speed of an interest rate hike by the U.S. Federal Reserve, after
minutes from the central bank's January diminished expectations for
a June move on rates.
On Tuesday, Federal Reserve Chair Janet Yellen gives semiannual
testimony on the economy and monetary policy before the Senate
Banking Committee.
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"In the near-term, the Fed is pretty much out of the picture. If you
look at what they said (in the minutes), they are in no big hurry to
raise interest rates," said Jeffrey Saut, chief investment
strategist at Raymond James Financial in St. Petersburg, Florida.
"I do believe Janet Yellen at her word. They are going to be
data-dependent. While we have had some softening, the general trend
of the recovery is still intact."
Retailers will also garner some attention as earnings season winds
down, and investors look for signs consumers have increased spending
with cash saved from lower gas prices. Macy's, Dow component Home
Depot, Target, Lowe's Companies and Gap Inc are among the notable
names scheduled to post results next week.
(Reporting by Chuck Mikolajczak; Editing by Nick Zieminski)
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