The economy also could be a factor. While most strategists expect it to grow at a better pace in the second half, there are concerns it may not be as strong as expected. First quarter GDP contracted 2.9 percent, and the second quarter is expected to grow by about 3 percent.
"It will be about deciding which was real and which was the imposter when you look at economic growth in the first and second quarter. The market is believing the second quarter is the re real deal, and we would say the same thing," said Stone, though he said there is still a "sliver of doubt."
Pending home sales showed a strong improvement Monday, the latest piece of housing data to show a winter slump is reversing. The pending sales were at a four-year high.
"Many people seemed worried the housing sector softness seemed persistent, and we could be entering another weak period for the housing market," said Barclays chief U.S. economist Dean Maki. "The most recent data should ease fears that housing was going to be in a persistent downturn. At the same time, it's still a moderate housing recovery. Really nothing has changed."
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Maki expects to see an improvement in ISM manufacturing to 56, from 55.4, when it is released at 10 a.m. Tuesday.
"The regional surveys did pick up in June, and we also saw new orders picking up in the ISM in May and that suggests production should pick up in June," he said.
Maki expects to see vehicle sales Tuesday, falling slightly to an annualized selling rate of 16.3 million, from the unexpectedly strong 16.7 million in May. Construction spending is also reported at 10 a.m.
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The big data for the week, however, is the nonfarm payrolls for May, expected Thursday morning, ahead of the July Fourth holiday. Maki expects to see 250,000 jobs, above the 210,000 or so consensus.
"Every indicator we're looking at looks stronger in June than May," Maki.
He does expect growth to pick up and sees 2.5 percent GDP. "The first half has been weak. We think we'll be bouncing back as to what will be an above trend pace," he said.