stock market forecast

The stock market today (Monday) is wavering between gains and losses after the S&P 500 last week recorded its best advance in 20 months.

With few economic indicators today and earnings season winding down, investors are dealing with reports that Japan's economy is slowing.

Japan's cabinet office reported that gross domestic product (GDP) grew at a 1.4% annualized rate in the second quarter, compared to 5.5% in the previous quarter and below the 2.3% economists expected.

Investors are eyeing Europe with a continued sense of apprehension after Italy completed a successful round of selling one-year Treasury bills. Yet, investors worry that Italian yields on ten-year bonds will soon reach Spain's which is once again hovering at the dangerous 7% line.

After three days of gains that put the major U.S. indexes at their highest levels since May the stock market today opened slightly lower. Concerns over global productivity, the Eurozone debt crisis, and a comment by Federal Reserve Bank of Dallas President Richard Fisher have choked the short rally.

Fisher stated that adequate economic stimulus is in place and that global central banks may not have the capacity to undertake additional stimulus measures.

In the U.S., nonfarm productivity grew faster than expected during the second quarter, but still at a slow 1.6% annual rate. Economists had expected on average to see a 1.3% rate. The Labor Department also revised numbers from earlier this year and 2011 that showed productivity was better than originally thought.

Overseas, Standard & Poor's Rating Services on Tuesday lowered Greece's long-term credit outlook from "stable" to "negative." The rating agency said that Greece will need further aid from international lenders and needs to implement harsher austerity measures.

The outlook drop means Greece's credit rating, which remained at the junk status CCC, could be lowered in the near future if Greece does not receive additional funding.

England's central bank issued its quarterly inflation report Wednesday and it was not optimistic. The Bank of England cut its prediction for GDP growth this year from 0.8% to 0.0%. The bank also lowered its forecast for economic growth over the next two years from 2.6% to 2%.

"The economy will continue to face headwinds over the forecast period, from the fiscal consolidation and tight credit conditions at home, as well as from the difficulties in the euro area and a broader slowing in the world economy," Bank of England governor Sir Mervyn King said in a statement.