Consumer Confidence Jumps, Stocks Weak

     This is an early headline at cnbc.com today and it says it all. After all, as the jump in consumer confidence was totally unexpected why should stocks be weak?

     Well, actually, after the good news. stocks started to mitigate their losses:

     "Stocks pared losses this morning following a surprisingly strong increase in consumer confidence in July. Other economic data, including the Chicago Purchasing Managers Index, was also more encouraging."

      http://www.cnbc.com/id/48415895

      "Yesterday, markets ended down slightly, as investors were unwilling to make any big moves ahead of the central bank meetings this week."

      "Market participants will look for hints of further stimulus measures to spur growth and are hoping the ECB will start buying Italian and Spanish bonds to keep yields down. The ECB's policy decision is due on Thursday, while the Federal Reserve's policy decision is out on Wednesday afternoon. Investors will be looking for hints that the Fed will undertake additional steps to stimulate economic growth. (Read More: Wall Street Now Almost Certain Fed and ECB Will Act)."

     See, what I can't help but wonder about here is market logic. Does the market see this as good news as what they have been waiting for the last few days is to see if the Fed-and the ECB-will act? And isn't it plausible that the better than expected numbers will make the Fed less rather than more likely to act?

     "On the economic front, June personal income rose 0.5 percent after a 0.3 percent increase in May and consumer spending was unchanged after being down 0.1 percent the month before. The Street was expecting personal income to rise 0.2 percent and spending to rise 0.1 percent."

    "Also, the second-quarter employment cost index increased 0.5 percent after a 0.4 percent rise in the first quarter."

    "The S&P/Case-Shiller 20-city home price index rose 0.9 percent on a seasonally adjusted basis, topping expectations for a 0.5 percent increase. In a non-seasonally adjusted basis, prices jumped 2.2 percent."

    "The July Chicago PMI rose to 53.7 from 52.9 in June. Economists were looking for a reading of 52.5. A reading above 50 indicates expansion in the regional economy."

     "Also, July consumer confidence jumped to 65.9 after a reading 62.7 in June. Economists were expecting a reading of 61.5. "

     In another snippet of news unlikely to raise market confidence, the German Bundebank is not happy with Drahii's Chuck Norris act last week:

     "In a statement that appears aimed at dampening market expectations for actions from the European Central Bank, a Bundesbank source tells CNBC that “monetary policy should strictly focus on its primary mandate to preserve price stability.”

     http://www.cnbc.com/id/48416555

     "Draghi had been scheduled to meet with Bundesbank president Jans Weidmann ahead of Thursday’s meeting of the ECB’s Governing Council."

      However, it's important to realize that Germany has no extra clout at the ECB just because it's the largest economy, and the ECB has voted over it's ojections before:

    

      "Although it represents the largest economy in the euro zone, the Bundesbank does not hold any additional voting power on the council."

     "In the past, the ECB has acted over German objections. In fact, two German ECB members have resigned in the wake of ECB actions to address the financial crisis."