Last Friday, the stock market closed out its best week since mid-March, with all three of the major U.S. stock indexes showing gains of at least 7 percent. Although reported second-quarter earnings have declined more than 30 percent over last year, the majority of companies surpassed analysts' projections. Investors' optimism was bolstered by earnings reports from companies in the banking and tech sectors last week.

Next week, investors will be looking for encouraging news from large, diversified manufacturing companies, including 3M. Better-than-expected earnings reports will continue to be the driving force behind investors' belief that the economy is moving toward recovery.

Investors will be listening as Federal Reserve Chairman Bernanke reports on Tuesday to the House Financial Services Committee and on Wednesday to the U.S. Senate. No policy decisions are expected, but Bernanke's words on monetary policy and the economic outlook will be scrutinized as investors look for evidence that the economy is strengthening.

Next Thursday, the existing home sales data is expected to reveal an increase in sales for the third straight month. There is the possibility, however, that homeowners waiting for better prices have created a backlog of unlisted properties that will depress prices when those homes finally do come to market.

Also on Thursday, weekly initial jobless claims are expected to rise to 550,000, from 522,000 the previous week. The unemployment rate continues at a 25-year high.

On Friday, the University of Michigan will release the July consumer sentiment index, expected to be slightly above last week's preliminary data, but still more than 5 points lower than one year ago.

10 Stocks to Watch

All 10 stocks in this week's outlook are at technical resistance on the daily charts. A break higher will take all 10 stocks above their recent May and June highs. The 10 stocks are AmerisourceBergen Corp. (ABC), Norfolk Southern Corp. (NSC), KLA-Tencor Corporation (KLAC), Altria Group, Inc. (MO), Broadcom Corporation (BRCM), Janus Capital Group Inc. (JNS), Lorillard Inc. (LO), MeadWestvaco Corp. (MWV), State Street Corporation (STT), and Teradyne, Inc. (TER).

Dave Mecklenburg is the Editor-in-Chief of TigerSharkTrading.com.