What to Watch in the Day Ahead - Friday, July 24

Thu Jul 23, 2015 2:35pm EDT
 
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(The Day Ahead is an email and PDF publication that includes the day's major stories and events, analyses and other features. To receive The Day Ahead, Eikon users can register at . Thomson One users can register at RT/DAY/US. All times in ET/GMT) Research-based biopharmaceutical company AbbVie Inc, which agreed in March to pay $21 billion for smaller U.S. drugmaker Pharmacyclics Inc, is expected to report strong profit and sales growth for the second quarter, largely due to continuing strong sales growth of its Humira treatment for rheumatoid arthritis. Investors will look for hints of other deals that might be on the horizon to lessen AbbVie's dependence on Humira before the $12 billion-a-year drug faces competition from biosimilars, possibly within a few years.

Biotechnology company Biogen Inc is expected to report higher second-quarter sales and earnings as sales of its key multiple sclerosis drug, Tecfidera, are expected to perk up after disappointing Wall Street last quarter. Investors will be looking for evidence of whether demand for the leading oral MS drug Tecfidera is flattening. The spotlight, however, will be on data related to the biotechnology company's much-anticipated Alzheimer's drug, Aducanumab.

The U.S. Commerce Department issues new single-family home sales for June, which is likely to remain steady at 0.546 million units. (1000/1400) In another report, financial data firm Markit's preliminary Manufacturing Purchasing Managers' Index for July is expected to be unchanged at 53.6. (0945/1345)

Detailed negotiations on third Greek bailout is due to open in Athens with experts from the European Commission, European Central Bank and International Monetary Fund. The Greek parliament voted overwhelmingly to approve the second package of reform measures. Greek officials say they aim to wrap the talks up and have a deal approved in parliament by Aug. 20, when a 3.4 billion euro repayment to the ECB falls due.

Second-quarter unit revenue is expected to decline for American Airlines Group Inc as the company faces weak demand abroad due to a strong U.S. dollar. Investors will watch for guidance it gives on whether it will lower capacity growth plans in line with demand, as rival United Continental Holdings Inc did on Thursday. U.S. regulators will be listening for the guidance too, as the Justice Department is investigating whether U.S. carriers have worked together illegally to keep fares high by signaling supply cuts.

Xerox Corp, which has been shifting its focus to IT services from making printers and copiers, is expected to report second-quarter results that are slightly below Wall Street expectations, according to analysts. Xerox, which gets about a third of its revenue from outside the United States, is also expected to be hurt by the strong dollar. The 110-year-old company has been moving toward services in recent years to make up for the falling sales of its copiers and printers as companies cut down on printing and personal computing moves to tablets and smartphones.

Encana Corp, Canada's largest natural gas producer, is expected to swing to a second-quarter loss, hurt by weak commodity prices. The company made an untimely shift to oil production just as global crude prices started crashing, weighing on revenue and margins. The company has slashed capex and cut jobs to improve margins. Investors will want to know about the company's cash flow expectations; cost controls measures and production forecast. Investors will also want to know more about the company's planned sale of lower-margin assets.

Brazil's Getulio Vargas Foundation releases its July consumer confidence index. Separately, Mexico's national statistics agency issues May data for economic activity, which is expected to have increased 1.20 percent annually, at a slower pace compared to the 2.10 percent rise in the prior year. (0900/1300) In another report, Mexico's jobless rate for the month of June is likely to have risen 4.42 percent, compared to 4.45 percent in the prior month. Also, Argentina's government issues May data for economic activity, which is likely to have grown at an annual rate of 1.0 percent. (1500/1900)

LIVECHAT: Economic Outlook with Maria Fiorini Ramirez, Chairman, MFR Securities Now that the Grexit has been booted into the future, how are other fiscally challenged economies in Europe looking? Maria Ramirez returns to the Global Markets Forum to discuss these and other macroeconomic issues in the global economy. (1030/1430) To join the Global Market Forum, click here: bit.ly/1kTxdKD (Compiled by Nivedita Balu; Edited by Maju Samuel)