There's little chance Fed Chairman Ben Bernanke will say much to soothe the markets when he speaks on the economy Thursday afternoon.
But regardless, his comments at 1 p.m. are likely to be among the most important headlines of the day and could be a big driver for markets. Bernanke speaks on the financial markets, the economic outlook and monetary policy at a time when the markets are thick with rumors that the Fed could cut rates even before its next scheduled meeting.
You can be sure Bernanke won't comment on that, but those rumors are swirling against the backdrop of ever increasing recession chatter on Wall Street. On Wednesday, Goldman Sachs joined the ranks of firms that expect the economy to fall into a recession this year. Goldman's economists though expect the Fed to be aggressive with rate cuts, and also anticipate some fiscal stimulus from Washington this year.
Other news to watch Thursday includes chain store sales reports for December. These comments from retailers will be watched as the final verdict on the holiday shopping season.
"It'll probably be a tough morning for them (retail stocks)" because of all the downward revisions, said Eckhart and Co managing director Peter Costa from the NYSE Wednesday afternoon.
There are also a few data points to watch Thursday morning including 8:30 a.m. weekly jobless claims. (See Econorama below)
Bernanke speaks before the Women in Housing and Finance and the Exchequer Club in Washington. He will take questions after his speech. At the same time, Kansas City Fed President Thomas Hoenig speaks in Kansas City about the economic outlook.
Up, Up and Away
Stocks Wednesday staged a fairly decent rally late in the day and the financials, just as they were in Tuesday's selloff, were a focal point of the market's volatility. The strongest Standard and Poor's sector was information technology, up 2.2 percent, then financials, up 1.7 percent. The Dow finished up 146, or 1.2 percent, to 12,735. The S&P 500 was up 18.94, or 1.4 percent to 1409, and the Nasdaq rose 34 points or 1.4 percent on that big lift in technology stocks.