Jobs and retail data take the spotlight once again in the trading week ahead. TheStreet’s Mike Khouw and Jill Malandrino of Action Alerts OPTIONS say the JOLTS report, retail sales and other manufacturing data are key to watch because trading has really been centered around interest rate hike speculation. Khouw points out inflation is where the Fed is really focused before he thinks it will raise rates. The inflation target is for 2-3% and we are well below that. The earnings calendar is also relatively quiet. Three stocks Khouw and Malandrino highlight are Hovnanian (HOV), Lululemon (LULU) and ExOne (XONE). HOV has unperformed virtually all of the homebuilders, a group that has outperformed the market this year. This is a sector that is especially sensitive to higher rates. LULU is a leader in the athleisure trend and beat earnings last quarter. Retail earnings have been lackluster this quarter, so the key will be to see if LULU can continue to outperform. XONE is in the 3D printing space, and while it is a fascinating sector watch for future product implementation, the stocks have has been under a lot pressure. While short interest has been falling a bit in the group, it has actually increased in XONE and that makes it interesting to watch following the earnings print. Short interest in XONE is near 40% and that could set up for the classic short squeeze.
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