Even though Canadian investors were treated to a shortened week thanks to the Victoria Day holiday, equity markets could not escape the continuous banter surrounding Greece and its future within the Eurozone.

I’d like to tell you that there were other factors influencing market activity, but share prices are very sensitive to macroeconomic and geopolitical events at the moment, and Europe is dominating the headlines.

The most important event of the week came at its midpoint when Brussels hosted yet another meeting of Eurozone leaders to discuss the ongoing debt crisis. Rumours emerged that leaders were told to prepare contingency plans in case Greece were to exit the Euro since maintaining the status quo may not be possible.

Read: Greece’s exit would be welcome

In corporate news, Facebook made headlines but for all the wrong reasons as investors continued to digest last week’s IPO only to get a bit of indigestion from a falling share price. Earnings out of Dell and Hewlett Packard (HP) illustrated the personal computer market is struggling to compete with the development of tablets and smart phones.

Dell delivered disappointing earnings, while HP beat analyst expectations. However, HP CEO Meg Whitman also announced the company would restructure to remain competitive, resulting in the loss of 27,000 jobs over the next couple of years.

In Canada, the banks garnered the most attention as Bank of Montreal, Royal Bank and TD Bank reported their Q2 earnings. Overall, the results were mixed as TD had the best earnings of the three, Bank of Montreal beat expectations thanks to some non-recurring items and Royal Bank fell just short of estimates.

One theme that has emerged is that all banks so far have had difficulty growing net income in the Canadian banking segment from last quarter.

On the commodity front, while we did not see significant rebounds, we did see some stability in oil and gold prices after material declines since the beginning of the month. The Canadian dollar continued its decline just managing to stay above the US$0.97 level after touching US$1.02 at the end of April.

Time to hit the “dislike” button

After all the nauseating hype about Facebook, one of the most anxiously awaited IPOs in a long time has most investors rushing to their computers to hit the “Dislike button”. All the problems that accompanied the first day of trade have led to lawsuits this week. If the stock was materially higher than the US$38.00 per share IPO price, I’m sure a lot these problems would disappear.

Unfortunately performance this week has been terrible as the stock is struggling to stay close to the US$32.00 level, which means that investors who managed to get a piece of the IPO are down 15% already on their investment. Admittedly it’s early to judge the performance of investment. Admittedly it’s early to judge the performance of Facebook now that it’s a public company, but questions about the business remain unanswered.

Can the company drive more revenue out of its 900 million subscriber base and can Mark Zuckerberg truly lead this company strategically? Only time will tell, but one thing we do know is that Mr. Zuckerberg is smiling now that his net worth has been pegged at $19 billion. Somehow I don’t think he’s going to Niagara Falls for his honeymoon.

While our American neighbours will be firing up the BBQs and enjoying their Memorial Day holiday on Monday, Canadian markets will be open for business as usual. The American trading week will be short, but it will not be uneventful, as investor focus will turn to several U.S. economic indicators.

The most influential indicator will be the U.S. employment report, which is due out on Friday. Recent reports have been disappointing with respect to the number of jobs created as the 200,000+ job prints have fallen back into the 100,000+ range, and that trend is expected to continue next week as economists are only looking for the creation of 150,000 jobs in the month of May.

The Canadian employment report will be released the following Friday. In addition to the non-farm payrolls data, investors will be paying close attention to the ISM Manufacturing Index, which is also due out on Friday, and the S&P Case-Shiller Home Price Index on Tuesday, which will give us some insight on the health of the struggling U.S. housing market.

Naturally, these economic reports may have an impact on the U.S. dollar, and as a result, commodity prices as well. The employment report in particular will have implications for the Federal Reserve and U.S. monetary policy as the market is becoming increasingly convinced that another round of Quantitative Easing (QE) is just around the corner south of the border. This is one reason that some investors have started to revisit investments in gold.

With respect to corporate earnings on both sides of the border, the week ahead will be remarkably quiet with the exception of the Canadian financial sector as the other half of the big 6 Canadian banks that did not report earnings this week will have their turn next Tuesday and Thursday. Bank of Nova Scotia, CIBC and National Bank will step up to the plate and provide an update for investors.

Question of the week

Leaders of the Eurozone met this week. Why did they meet and was anything accomplished?

Sometimes we wonder why the heads of state within the Eurozone get together, especially when they finish their meetings and very little, if anything, has changed when it comes to the Euro and the future of the monetary union. We’ve lost track of how many meetings this group has had over the past couple of years, but it’s probably close to 20 at this stage.

Why did they meet? Other than this being the first Eurozone meeting for the new French President François Hollande, we’re not exactly sure why they met.

The press told us they were meeting to help find ways to assist struggling countries and that the topic of the “Eurobond” would be raised. However, that sounds similar to what these leaders have discussed at every meeting they’ve had thus far.

Was anything accomplished? I’m sure the leaders would tell you that progress was made, but I’m not quite sure if this group is any closer to finding a solution to the debt crisis.

President Hollande wants German Chancellor Angela Merkel to stop focusing on austerity and focus more on growth; however, I’m sure he was reminded that growth requires investment, and that there isn’t a lot of money lying around in Europe at the moment.

As for the “Eurobond”, which I thought had been put to rest long ago, the Germans and other northern Eurozone members remained staunchly against the issuance of a “Eurobond” while the southern countries supported such an idea.

Since Chancellor Merkel will have the last say on this issue, the debate over a “Eurobond” won’t go very far. If there was one thing that came out of this week’s meeting, it was that Eurozone leaders are likely preparing contingencies if Greece does in fact leave the Euro once and for all.

We’ll get a much better idea of how likely such a move will be once the Greeks go back to the polls on June 17th as parliamentary elections will certainly be more of a referendum on Eurozone membership than anything else.