Friday: Chicago PMI, Consumer Sentiment

Three interesting reads ...

From Merrill Lynch on house prices:

The momentum in home prices has continued to exceed even our bullish expectations. The S&P Case-Shiller index increased 16.7% annualized in 1Q and continued to climb higher in April, sending prices to a 12.1% yoy rate. We therefore have revised up our forecast for home prices from 8% 4Q/4Q growth this year to 11.8% 4Q/4Q. The three factors boosting home prices have been: shrinking share of distressed properties, low months supply and an increase in momentum; we believe the latter is the most powerful.
...
We also maintain our forecast that home price appreciation will slow to 6.5% next year with a risk of annual price declines within the next five years. This is decidedly not the beginning of a housing bubble.

I expect more inventory to come on the market, and for price increases to slow.

From Peter Nicholas and Jon Hilsenrath at the WSJ on the next Fed Chairperson: White House Assembles List of Potential Bernanke Successors at Fed

People familiar with the process wouldn't divulge any names on the shortlist, but said there was no front-runner. The White House is still in an early stage of the process and might not announce its selection until the early fall, they said.

Let me help - the front runner is Fed Vice Chair Janet Yellen.

And Josh Lehner looks at state level employment data and expects an upward revision to national employment: State Employment Revisions, 2012q4

Using this quick method of comparing the different data series, the private sector sum of all the individual states is expected to be revised upward by approximately 500,000 (0.5%) for December. However, the topline U.S. employment estimate is currently larger than the sum of states would suggest. As such, we can expect a somewhat smaller upward revisions of around one month’s worth of job gains (200,000) in the national figures.

Friday:
• At 9:45 AM ET, the Chicago Purchasing Managers Index for June will be released. The consensus is for a decrease to 55.0, down from 58.7 in May.

• At 9:55 AM, the Reuter's/University of Michigan's Consumer sentiment index (final for June). The consensus is for a reading of 83.0.