Euro Crisis Watch: The Week Ahead

The past week was a busy one for the Eurozone, with rate decisions, policy inaction and lots of economic data marking a tumultuous week in markets. The week beginning August 6 should continue to have all eyes focused on Europe as Spain edges closer to a full sovereign bailout and the ECB primes the printing presses. Investors would be wise to understand key events in the week ahead that could shift sentiment, and the following are just a few of those events.

For a change, Monday has a rather bleak economic data docket and investors can actually focus on fundamentals and earnings. 611 companies are expected to report earnings through Thursday of next week and volatility could come from those names reporting as guidance on Europe could give further clarity into the state of the economy.

Investors will awake Tuesday morning to the Royal Bank of Australia's interest rate decision, where Governor Glenn Stevens is expected to keep rates on hold at 3.5 percent. He may give guidance into the state of the world economy and may comment on Europe, as Australia is exposed to Europe through exports of raw materials. Later Tuesday, Italy will be in the spotlight with industrial production data for July and GDP for the second quarter are both set to be reported. Also, German factory orders will be a key number to give insight into the state of the German economy.

German and Spanish industrial production mark the early data calendar Wednesday, as Spain will once again be thrust into the spotlight. Its bonds will surely react to every data point released. Also, Chinese inflation data is due out late Wednesday night alongside Australian unemployment data. Strength in Chinese inflation could indicate that the global economy, at least global trade, could be bottoming or even reaccelerating.

Thursday brings more data on China as industrial production data is due out, and comments on the state of the European economy as it pertains to China and Chinese exports. Friday also brings more European data, with German inflation data and French industrial production due out.

Surely next week should bring further clarity on the state of Europe's economy, and these data points could help investors to understand the European economy with more current data. Also to watch are impromptu or even scheduled speeches from European leaders, mainly those of Spain, as it seems ever more likely that Spain will be forced to enter into a full sovereign bailout to receive bond market assistance.