January 24, 2011

Fiduciary Next Steps, Earnings, the Fed and Obama’s Union: Advisor Briefing for the Week of Jan. 24, 2011

Politics may shape fight over fiduciary standard, and the State of the Union

One of the most closely watched disputes to affect advisors in years became clarified Saturday, if not finally resolved, with the SEC recommending extending a fiduciary standard to all advice givers, including brokers. The weekend release of the report, coupled with the public, unprecedented dissent by the two Republican Commissioners on the SEC, suggests that the rulemaking process on a fiduciary standard will be fraught with politics.

Politics will also be on the front burner this week with Tuesday’s State of the Union address by President Obama; his appointment last week of two high-profile business executives to his team, including GE’s Jeffrey Immelt, might have resulted in hosannas from advisors who have long wished for a more business-friendly Administration, were it not for the skepticism that seems to greet every move from Washington these days.

Other market-moving domestic news of the week include more Q4 and FY2010 earnings reports (see AdvisorOne’s continuously updated earnings calendar to stay current), the final report from the Financial Crisis Inquiry Commission and the first reading of GDP in 2010’s fourth quarter.

Overseas, with President Hu’s American visit over, many economic and bond trading eyes will be focused on the Davos economic forum that convenes Wednesday in Switzerland and on the currently sickest man of Europe—Ireland—which finds itself in political disarray with a minority government attempting to move forward a finance bill to bring the tamed Celtic tiger out of its financial morass.

Monday, Jan. 24, brings an expected report from S&P questioning the credit ratings of some municipal bond issuers, while insiders at Envestnet become eligible to sell shares of the company that went public July 29, 2010. The House of Representatives convenes at noon.

Obama delivers his State of the Union speech at 9:00 PM on Tuesday, Jan. 25. Earnings include BlackRock and Calamos, while economic reports include the S&P/Case-Shiller Home Price Index and the Conference Board’s January Consumer Confidence Index report. The Senate convenes at 10:00 AM.

The Davos World Economic forum convenes on Wednesday, Jan. 26, in Switzerland, while in San Francisco Macworld 2011 kicks off without Steve Jobs; running high-flying (until recently, at least) Apple on a day-to-day basis is COO Tim Cook. The Federal Reserve’s Open Market Committee (FOMC) concludes its two days of meetings with a statement, while a report is released on December new home sales  and earnings are expected from Legg Mason and Piper Jaffray.

On Thursday, Jan. 27, the Financial Crisis Inquiry Commission (FCIC) is scheduled to release its final report. Other economic reports due out include durable goods orders for December and weekly first-time unemployment insurance claims. The Senate Budget Committee welcomes Congressional Budget Office Chairman Douglas Elmendorf for a hearing on the budget and economic outlook for fiscal years 2011-2021. Yes, 2021. Earnings are due from Federated Investors, Franklin Resources, Invesco and Janus.

Friday, Jan. 28, brings the initial reading of U.S. GDP in the fourth quarter of 2010, along with the ThomsonReuters/University of Michigan consumer sentiment index for January and earnings from T. Rowe Price.

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