The Last Week in Review:

A favorable Consumer Price Index (CPI) report last week, along with falling crude oil prices and presto, another record Dow close. While many analysts thought that Q3 earnings would be the end of a string of double-digit earnings quarters, so far, of the 138 S&P 500 companies that have reported earnings, 15.6% have shown profit growth and few companies have warned about Q4 results.

These solid earnings reports, along with good news on inflation and declining energy prices provided the necessary ingredients for the Dow to eclipse 12,000 for the first time ever. The Dow was up 55 points on the week and is now up 12% year-to-date. The S&P 500 rose 5 points, increasing its year-to-date gain to 9.6%. The NASDAQ fell 4 points, reducing the index's gain to 6.2% for the year. The Russell 2000 closed the week up 5 points increasing its year-to-date gain to 13.2%, as small cap stocks continue to outpace large cap issues.

The Week Ahead

Earnings season continues this week with a steady flow of companies announcing results. Monday, AT&T (T), Halliburton (HAL), Ford Motor Company (F), Xerox (XRX), American Express (AXP), Amgen (AMGN), and Texas Instruments (TXN) will all report results. On Tuesday, announcements from Bell South (BLS), Burlington Northern Santa Fe Corp (BNI), Countrywide (CLC), DuPont (DD), Lockheed Martin (LMT), Whirlpool (WHR), Aflac (AFL) and e-commerce company, Amazon (AMZN), announce earnings. Wednesday begins with announcements before the market opens from Boeing (BA), Colgate Palmolive (CL), auto giant General Motors (GM), Reynolds American (RAI), and Waste Management (WMI). Symantec (SYMC) reports their earnings after the bell. Thursday, there will be pre-market announcements from insurance provider, Aetna (AET) and Blockbuster (BBI), Comcast (CMCSA), Dow Chemical (DOW), Exxon Mobil (XOM), Kellogg (K), and US Airways (LCC). Microsoft (MSFT) and SunMicrosystems (SUNW) will announce their earnings after the close. The week closes with announcements from Avon (AVP) and Chevron (CVX) before the bell on Friday.

The economic calendar for this week will be light. September Existing Home Sales will be announced on Wednesday, along with Weekly Crude Oil Inventories. The big news that day will be the announcement of the FOMC policy statement at 2:15 PM EST on Wednesday. Expectations are that the Fed will again leave interest rates unchanged, and it is unlikely they will change any language on their monetary policy. September Durable Orders, September Help Wanted Index and September New Home Sales announcements will all be released on Thursday. Friday's announcements include the Q3 GDP & Chain Deflator and the October Michigan Sentiment Index.

The conference schedule for this week begins Sunday with the five-day Oracle OpenWorld event held in San Francisco. Monday conferences include the two-day Johnson Rice & Company Consumer Conference in New Orleans and the two-day Sanders Morris Harris Middle Market Investor Growth Conference in New York. The two-day Financial Research Associates Biofuels Finance & Investment Seminar in New York begins Tuesday.

In summary, investors should continue to be focused on the corporate earnings reports and any signs of inflation.

Stay tuned!