Economic data will be in focus during the first full week of trading in 2009. The numbers, which include key payroll data Friday, are expected to paint a grim picture of the US economy during the final month of 2009. Consequently, investors will be watching to see if stocks can extend recent gains; and whether or not the Dow Jones Industrial Average can hold above 9,000 amid another round of gloomy economic news.

This week’s busy economic calendar kicks off with a report on Construction Spending Monday at 10:00 a.m. ET. Factory orders and the ISM Services Index are scheduled for Tuesday. Investors get a peek at the employment situation in December courtesy of ADP Wednesday morning and weekly jobless claims follow on Thursday.

Economists expect Friday’s jobs data to show a significant decline in payrolls during the month of December. After 533,000 lost jobs in November, economists predict that another 475,000 were lost during the final month of 2008. The unemployment rate is expected to increase to 7 percent from 6.7 percent.

After a dearth of profit reports during the past two weeks, the earnings calendar is a bit busier over the next five days. Mosaic (MOS) reports after the closing bell Monday. Wednesday, Supervalu (SVU), Family Stores (FDO), and Monsanto (NON) report before the bell and Bed, Bath and Beyond (BBBY) releases results after the close. KB Home (KBH) releases results Friday morning.

Among the other stocks to watch, Apple Computer (AAPL) will be in focus as MacWorld kicks off this week in San Francisco. Ford (F), GM (GM), and the other automakers release December results Monday. Limited (LTD) releases monthly sales results Thursday.

Crude oil prices will be watched ahead of inventory data due out midweek and after a big price swing Friday. Crude (February) hit a low of $41.05 a barrel early in the day, but traded up $1.57, or 3.57 percent, to $36.17 in late trading on the NYMEX. Gold finished up $4.80, or .5 percent, to $879.50 an ounce.

Stocks traded mostly higher Friday and the Dow Jones Industrial Average added almost 3 percent to close above 9,000 for the first time since early November. The tone of the market will be important this week as well. Investors will digest another round of grim economic data, setting up an important test for the major averages during the first full trading week of the New Year.

Frederic Ruffy
WhatsTrading.com