CNBC's Domm: Exciting Week Ahead

Investors will be ducking earnings bombshells and hoping to make some gains this week in what promises to be the busiest couple of days of the fourth quarter earnings season.

President Bush's State of the Union address Tuesday night and the Democratic response is the big political event of the week. It should be even more interesting now that three new entrants joined the presidential race over the weekend: Democrats Sen Hilary Clinton (New York) and Governor Bill Richardson (New Mexico) and Republican Sen. Sam Brownback (Kansas).

Major economic reports this week include fresh housing data and durable goods. And of course, there's the Oscars nominations Tuesday that everyone will be talking about.

It was a rocking week in the markets last week though some of the averages barely budged. The Dow closed out the week with a modest gain of 0.1%. The S&P 500 slid 0.23%. But the Nasdaq, where the action was, fell 2.1% for the week on the selling wave in technology.

Oil rode a wave of its own, closing out the week at $51.99, down 1.9%. That was after several days of big moves, including Friday's climb of 3% and Thursday's dip below $50 a barrel.

Our John Harwood will help us navigate the messages for business and investors in the President's State of the Union address. "There are a couple of issues that are in motion - climate change and health care where Democrats have a more aggressive stance and where we see business reacting ahead of political action to address them," he said.

Harwood also said we could see movement on immigration and entitlements, and he expects the President to make another plea on Iraq as he tries to keep the public with him.

Congress will also be busy this week as the Senate takes up minimum wage. The Senate Transportation committee Wednesday looks at the potential impact of airline mergers. That day, the Senate Energy and Natural Resources committee holds hearings on greenhouse gas reduction. The Sentate Budget Committee Thursday holds a hearing on the Congressional Budget Office's budget and economic outlook. The House Budget committee holds hearings on budget deficits Tuesday.

Drug makers, banks, techs, industrials, oil, medical and chemical companies all report this week. Pfizer and American Express report Monday; Johnson & Johnson, Bank of America and Yahoo report Tuesday; eBay and Conoco Phillips report Wednesday; Microsoft, AT&T and Dow Chemical report Thursday, and Caterpillar and Honeywell report Friday. That's not to mention hundreds of other companies that also report.

Those drug company results could hold some upside surprises, says Deutsche Bank's Barbara Ryan. In a report, Ryan said while Q4 for major pharma will "be a mixed bag with some still suffering the blows of new generic competition, we believe that (earnings per share) will continue to exceed expectations. More important, each is well positioned to deliver improved EPS results in 2007." Our Mike Huckman will be on the beat and will keep an eye Monday on Pfizer's meeting with analysts.

Despite the promise of some earnings week winners, our Jim Cramer warned watchers of Mad Money Friday that they should hold off trading as these earnings reports roll in this week. "You don't trade, you learn," he said. Perhaps he was thinking about some of the earnings blowups in the tech world we saw last week, such as Apple which was punished for a slightly softer forecast, Intel for its shrinking margins, and IBM for its sales. All of them beat analysts earnings per share estimates.

Cramer explained that corporate earnings reports contain clues to the economy's future performance. "You listen to the economy from the bottom up," he said.

And in case you missed it, Cramer last week said it was time to sell tech on seasonality. He made the call on Wednesday and said there were only a few tech stocks he likes in the sector for the next couple of months. The next day, tech selling was in full swing and the Nasdaq lost 1.5 percent. For more of Cramer's views on tech, see reporter Phyllis Burke Goffney's report on tech stocks, "Play Defense in Risky Tech."

The World Economic Forum's annual confab in Switzerland is usually big on heavy weight names from the world of business and politics but light on hard news headlines. But we hear the discussions are usually very interesting and that's why we want to hear what the movers and shakers who attend have to say. Our Maria Bartiromo will be there to tell us, starting Wednesday.

Our oil man CNBC's Global Energy Analyst Dan Yergin will also be there. Yergin, chairman of Cambridge Energy Research Associates, says the topic of energy at Davos has been a hot one in the past two years, and this year should be no different. The group does a simulation of what might be an unthinkable case for oil in the coming year.

"The discussion two years ago was about $80 oil. Last year, an actual simulation of an oil crisis took oil up to about $130 oil," he said. "This year what's unthinkable will be on the downside."

So where does Yergin see oil prices going? He says $40 or low $40s could be a floor. But he also said CERA maintains its forecast that the average price in 2007 will be somewhere between $55 and $60 a barrel. "The next two months could be shaky on price," he said.

Yergin also watches OPEC very closely, and shared some thoughts on what might be going on with the cartel now. For instance, why did the Saudis this week not jump on calls by Venezuela and Iran to hold an emergency meeting to agree on new production cuts. Yergin says the Saudis can very focused on inventory levels. Remember, we saw surprisingly high supplies of crude when Energy Department data was reported this week.

"This price level still works for their budget," he said. But that might not be true for the budgets of other cartel members, like Iran.

Yergin said Saudi Arabia does not want to be the swing producer, or the member that most affects the flow of crude at its own spigot. But he did say that while OPEC may not have an emergency meeting, it could have one ahead of schedule.

"One question is whether they would now move the March meeting to February," he said. Good question as we look ahead to what could be another volatile week in the energy markets. Our Sharon Epperson points out that the February crude contract expires Monday.

Durable Goods and real estate data at the end of the week will attract the most attention. Existing home sales for December are reported Thursday at 10 a.m., and new home sales are Friday at 10 a.m. Durable goods data for December is reported before the bell Friday.

The Richmond Fed survey will be released Tuesday at 10 a.m.