Expectations about " Black Friday," when Americans traditionally get serious about holiday shopping, could sway stocks this week if it looks like the economy will get a pop from consumer spending.
The outcome of talks to shape a bailout for Ireland could also move stocks, analysts said, but they cautioned that other highly indebted euro zone countries could still be a source of worry.
Trading volume is expected to be light during the holiday-shortened week of Thanksgiving. In addition, investors will watch to see whether retail sales appear strong enough to give the market a Santa Claus rally in December.
Retailers have been optimistic in their forecasts for holiday sales, and investors will want to see evidence to support those forecasts as worries about consumer spending weigh on the economic outlook.
Target Corp. last week was the latest retailer to give an upbeat forecast, saying it expected to post its best sales in three years at stores open at least a year.
The day after Thanksgiving traditionally marks the start of the holiday shopping season and is called Black Friday because retailers generally make enough sales to get their accounts out of red ink.
Shoppers are expected to flood stores in search of bargains while retailers fight for their share of those sales. Target, for instance, is using a built-in discount for shoppers who use its store credit card.
"It's a very competitive retail environment … a sign people are slugging it out" for every last sale, said Sasha Kostadinov, a portfolio manager at Shaker Investments in Cleveland.
With the recent market weakness, the Standard & Poor's 500 index has had trouble staying above 1,200 points and ended just below that level Friday.
A push above the mark, however, "would be a good sign," signaling bullish momentum, said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research.
Last week, the Dow Jones industrial average rose 0.1%.
Among this week's economic data is the government's second estimate of third-quarter gross domestic product, which is expected to show the economy grew a bit faster than previously thought.
Two reports on housing are expected as well: sales of previously owned homes, which are expected to show a drop in October sales after two months of gains; and new-home sales data, which are expected to show little change.
Other reports will look at manufacturing, consumer spending and inflation.
Investors will check to see whether the data support the Federal Reserve's decision this month to buy $600 billion in bonds in an effort to boost the economy.
On Tuesday the Fed will release minutes from the policy-setting meeting in which officials discussed the bond-buying decision.