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Market Wrap-up for Mar. 2 - Three Things to Watch for in the Markets This Week

Here’s a run-down of the three key issues that investors should be focused on this week in the markets.

1. Nasdaq 5,000

Don’t look now, but the Nasdaq Composite is once again nearing all-time highs. History hasn’t been kind to this lofty level, however. The last time the benchmark index closed above 5,000 was in March 2000, just before the dot-com bubble burst. Within a year of hitting 5,000, the Nasdaq fell below 2,000, marking the end of a euphoric investing era dominated by tech stocks.

There’s no disputing the fact that technology is back in vogue — and for good reason. Tech has infiltrated nearly every corner of the wider economy. What once was a fledgling sector with many shaky companies has now become a real economic powerhouse. Unlike back in 2000, most of today’s high-flying technology stocks have real earnings to back up their share prices.

Still, there’s no denying that stocks are generally expensive right now. Many analysts believe Nasdaq 5,000 could be a good time for stocks to take a breather, and I tend to agree.

2. A Few Key Earnings

Foreign Banks on Tap

On Tuesday, we’ll see earnings from Barclays (BCS ) and Bank of Nova Scotia (BNS ). Given the turmoil both in the eurozone and the oil markets, it’ll be interesting to see how these companies fared.

Retailers in Focus, Too

Also on Tuesday, we’ll get earnings results from Best Buy (BBY ) and Dick’s Sporting Goods (DKS ), two retailers whose shares have told very different stories over the past five years. As BBY has sputtered, DKS has remained strong, indicating that while consumers now prefer to buy electronics online, a lot of sporting goods shopping is still done in-person.

We’ll also see results from PetSmart (PETM) on Wednesday, and Costco (COST ) and Kroger (KR ) on Thursday.

3. Friday's Jobs Report

Always a favorite of market pundits, Friday brings us the latest employment situation report from the Bureau of Labor Statistics. On average, Wall Street analysts expect to see 235,000 new jobs created in February, with the unemployment rate ticking down slightly to 5.6%.

While one month of job statistics isn’t particularly meaningful on its own, the monthly numbers help illustrate longer-term trends. Because January’s jobs report was roundly lauded as very strong, February will look to build on that momentum. Since the jobs report is the one time a month that Wall Street, Main Street, and Washington collide, it’s certainly worth taking note of, and more importantly, watching the market’s reaction to it.

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