Heading into a long holiday weekend, company-specific news may be light. But Washington is gearing up to release a slew of important data. Here’s a look at three economic items to watch:

Home Prices look for a Floor
Here’s a sobering stat: As of the first quarter of 2010, average home prices across the United States are at levels similar to what they were in the spring of 2003. They rose sharply in the middle of the decade, but have given back all of those gains during the past three years.

On Tuesday, we’ll get the latest reading on housing prices from the S&P Case Shiller Home Price Index. So many potential home buyers are sitting on the sidelines waiting to see when housing prices will turn up. They know that prices are cheap, they just don’t want to see a newly acquired asset become even cheaper. But an upturn in housing prices could be a big motivator to get in the game, and trigger a long-awaited rebound in demand.

Analysts at Case Shiller noted in their last report that “housing prices rebounded from crisis lows, but recently have seen renewed weakness as tax incentives are ending and foreclosures are climbing.” We’ll probably get more of the same when the latest set of data are released.

Rising Demand for Goods and Services
The Institute for Supply Management (ISM) takes a pair of monthly snapshots, one for the manufacturing sector and one for the service sector. The manufacturing report will be released on Thursday, July 1, and lately that metric has been on a roll. The ISM index has expanded for 10 straight months, which means that it has been above 50.0 that whole time. (Any reading below 50.0 implies that the manufacturing sector is contracting).  Of the 18 different manufacturing categories the ISM tracks, 16 grew in May.

But growth may be weakening. That May reading, though signaling further gains, still dropped from 60.4 to 59.7. The reading can be erratic, rising in January, falling in February, rising in March and April, and falling in May. That tells you that the economic recovery has been uneven.

If the June reading falls modestly, to no lower than 58.5, then investors won’t be alarmed. But any reading below that would clearly spook the markets as it would show that manufacturing growth has begun to sharply decelerate.  The data will be released at 10 a.m. EST on Thursday. The market will be open, so if you’re an active trader you’ll need to quickly digest the latest number.

The All-Important Employment Report
If it’s the first Friday of a new month, then it’s time for the monthly view of employment trends. The current round of figures is being skewed by a temporary spike in census-related hiring, so it is unclear how the market will react to fresh data. Yet it is increasingly clear that outside of the census, hiring remains anemic. And that’s a real problem, since state, local and federal governments are likely to shed many jobs in the months to come. Any material employment gains in the private sector may be offset by the layoffs of government workers, keeping the headline unemployment rate alarmingly high. Nevertheless, investors would be thrilled to see any sort of hiring spree in the private sector.

You need to go back 20 years to get a sense of how the employment picture may play out. In the early 1990s, many companies shed workers to offset slow sales, and then found that a smaller workforce yielded much higher profit margins. Yet even after profits rebounded (as they are now), companies held off hiring for another year or two, just to be sure that the economy didn’t slip back into recession. When hiring finally began to pick up a few years later, we experienced the greatest spurt of job creation in the nation’s history.

Circling back to the somber present, economists believe that the unemployment rate will hover at 9.7%. Any positive news on that front will be warmly-received by the market, but recent data imply that hiring remains weak.