The Democratic Convention Is Underway

The Democratic Convention will kick off the general election this week. There are three major objectives that the Democrats want to convey. One, that Obama is the candidate of change. This will cover everything from a change of strategy in Iraq to the the Supreme Court. Second, to make millions of undecided voters feel comfortable with Obama. This will be accomplished by Biden touting his years of experince on Capital Hill and foreign policy issues that will help Obama be seen as someone who can make things happen with a seasoned veteran on the ticket. Third, to show that the party is united. Hillary Clinton's speech on Tuesday night won't show any bitterness. However, off camera there may be some complaining. But this will not be shown to the viewers at home and will make the Democrats united behind one candidate.

Bottom Line: With millions of undecided votes up for grabs look for the general election to be close and very heated between the two major candidates.

China And Iraq To Sign Major Oil Agreement

China and Iraq are expected to sign a major agreement this week to develope the Ahdab oil field. The deal is expected to be valued at $1.2 billion. This is one of several contracts that Iraq is using to boost oil production to 3 millions barrels a day with the hope of increasing production to 4.5 million daily by 2013.

The Iraqi government continues to negotiate with 35 major oil compaines for the development of other fields as well. However, some of them are relucatant to do anything citing security concerns and the reduced length of the terms from two years to one. At present, negotions are still on going.

Bottom Line: The development of the oil industry is vital to Iraq's recovery.Oil accounts for 90% of the export earnings and 70% of it's GDP.

Upcoming Events And Economic Numbers

Monday August 25

Existing Home Sales: consensus: 4.90M prior: 4.86M

Tuesday August 26

Consumer Confidence: consensus: 53.0 prior: 51.9

New Home Sales: consensus: 523K prior: 530K

FOMC Minutes

Wednesday August 27

Durable Goods Orders: consensus: .1% prior: .8%

Oil Inventories: prior: 9.390M

Thursday August 28

GDP: consensus: 2.7% prior: 1.9%

Initial Claims: prior: 423K

Friday August 29

Personal Income: consensus: -.1% prior: .1%

Personal Spending: consensus: .3% prior: .6%

Chicago PMI: consensus: 49.9 prior: 50.8

Michigan Consumer Sentiment: consensus: 62.3

Upcoming Earnings

Thursday August 28

Sears Holdings (SHLD): Before the open: estimate: .33

Tiffany (TIF): Before the open: estimate: .54

Dell (DELL): After the close: estimate: .36

Buys

Boeing (BA): We like this as valuation and technical play. The stock recently completed a reverse head and shoulders pattern at 60.77. It has a forward PE of 9.46. There is a history of consistently paying and raising its dividend going back to 1969. Analysts are split on the stock with 12 rating it a buy or strong buy. While 12 have shares rated as a sell or hold.

Bottom Line: Look for shares of Boeing to go to the 52 week high of 107.15.