Weekly Market Commentary:

The New Year started with barely a whimper, as U.S. stocks closed mostly lower on the holiday-shortened week. The Nasdaq Composite was the only positive performer (2,434.25 +18.96 +.078%) as techs had a good week all things considered. The S+P 500 (1,409.71 -8.59 -.06%) and Dow Jones 30 (12,398.01 -65.14 -.05) fell just slightly less than the small cap Russell 2000 (775.87 -11.79 -1.5%).

It seems that after the first three trading sessions of the year, the market is still trying to find its way after a very impressive rally over the last half of last year. Friday's employment and payroll numbers showed increases that were worth noting. As a result of higher than expected results in employment and wage increases, market participants anticipating a rate cut were most likely disappointed. This helped take the steam out of a nice rally in early trading Thursday.

This Tuesday could bring word from the White House on President Bush's new "plan" for the war in Iraq. The installation of Democratic majority leaders in both the House and Senate has caused a bit of a revolving door shakeup at the White House. It remains to be seen what the new plan for the war will be but don't be too surprised if it results in more troops heading for Baghdad. Also, Alcoa kicks off what will be a widely watched fourth quarter earnings season.

Wednesday, the November trade balance is seen worsening slightly and high-end retailer Tiffany's holds their holiday sales conference before the market opens. On Thursday, the Bank of England is expected to keep interest rates steady, and the European Central Bank is expected to announce their decision regarding interest rates and provide some guidance on what to expect in the months ahead, while the U.S. Senate Budget committee holds a hearing on long term outlook.

Friday brings the December consumer sales report which is expected to show consumer spending inline with expectations (+.05%) while the bond market closes at 2 pm EST in advance of Martin Luther King Day. With all that said, the key to this week will be how trading shapes up by the close on Monday and Tuesday. With stocks stuck in the same place they were last May, it will be a very interesting week in deed.

Stay tuned!