Weekly Wrap

Weekly Wrap News of a European bailout agreement reached over the weekend sent stocks up 5.5% at Wednesday's close. But as European concerns reemerged and the euro slumped, a good portion of the advance was given back on Thursday and Friday. In the end the market settled up 2.2% -- a sizable gain but relatively modest compared to the recent steep declines.

All 10 sectors gained, led by industrials (+3.8%).

The biggest item of the week was an announcement over the weekend from the European Union regarding a loan package "to preserve the financial stability of in Europe." The 750 bln bailout package, which includes 250 bln euros from the IMF, will provide countries with loans in exchange for additional austerity measures. Separately, the European Central Bank announced it will intervene in the public and private debt markets. Meanwhile, the Federal Reserve reopened its currency swap lines to improve liquidity.

The news sent stocks, European sovereign debt and the euro rallying on Monday. But concerns quickly started to regain momentum. Former Fed Chairman Volker, for example, is still concerned that the eurozone is at risk of disintegration despite the bailout.

The renewed concerns about Europe sent euro below $1.25, ending the week at $1.239. That marked the lowest level since October 2008 and lower than the pre eurozone bailout level. In a similar fashion to the U.S., European equity markets finished the week with strong gains, but well below their intraweek highs.

Meanwhile, gold rallied to all-time nominal highs in a flight to safety bid. The precious metal rose 2.0% for the week to $1235 per ounce. Economically sensitive commodities, however, took a hit, with crude oil prices slipping 4.5%. The CRB Index ended the week down 1.1%.

In corporate news, shares of retailers fell after on Thursday disappointing earnings from names such as Kohl's (KSS). Still, the group gained 2.6% on the week thanks to strong gains earlier in the week.

Disney (DIS) and Cisco (CSCO) shares slipped after their earnings reports, despite both companies posting better-than-expected EPS and revenue.

Credit card companies Visa (V) and MasterCard (MA) took a hit on news that the Senate approved an amendment relating to interchange fees on debit transactions.

In economic news, retail sales in April rose 0.4% (consensus +0.2%) and were up 0.4% excluding autos (consensus +0.5%). On a year-over-year basis, retail sales increased 8.8%.

The breakdown of the April report reveals some mixed indications, as declines were seen in a number of areas -- furniture and home furnishing stores (-1.2%), electronics and appliance stores (-0.4%), food and beverage stores (-0.5%), clothing and clothing accessories stores (-1.0%), sporting goods, hobby, book and music stores (-1.9%), general merchandise stores (-0.4%), and miscellaneous store retailers (-0.3%).

Weekly initial jobless claims were in-line with expectations and the prior reading at 444,000.

Index	Started Week	Ended Week	Change	% Change	YTD %
DJIA	10380.43	10620.16	239.73	2.3	1.8
Nasdaq	2265.64	2346.85	81.21	3.6	3.4
S&P 500	1110.88	1135.68	24.80	2.2	1.8
Russell 2000	653.00	693.98	40.98	6.3	11.0