What to Watch in the Day Ahead - Tuesday, Oct 20
(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) Verizon Communications Inc, the largest U.S. wireless service provider, is expected to report marginal growth in third-quarter profit. The company in September warned earnings may "plateau" next year as evolving consumer habits drive changes to its wireless business model and as it forays into new markets such as mobile video amid stiff competition. Investors will look for subscriber additions and signs that its investments in "Internet of Things", the concept of connecting household devices to the Internet, will drive revenue and profit. With three cuts to its 2015 forecast already this year, United Technologies Corp will be looking to shore up investor confidence when it reports third-quarter results. Analysts will be closely watching for any impact the cooling Chinese economy is having on the conglomerate's Otis elevators business and for trends in its aerospace aftermarket sales, after UTC cut its expectations for that business earlier this year. Investors will be also looking to hints for performance in 2016, although CEO Greg Hayes has already signaled that the company is unlikely to meet its traditional goal of an at least 10 percent rise in profit next year. Property and casualty insurer Travelers Cos Inc's third-quarter earnings are expected to beat analysts' expectations. With no major catastrophes during the quarter, the company, a Dow 30 component, is expected to report a higher quarterly profit. The company's investment income, which has been falling as the Federal Reserve has maintained interest rates since the financial crisis, will be an area of focus. The steep fall in oil prices has also hit the company's investments in the energy industry made through private equity funds. The company, currently led by veteran Jay Fishman, is in the middle of a transition, with Alan Schnitzer, CEO of Travelers' business and international insurance unit, expected to take over this December. Yahoo Inc is expected to report third-quarter profit well below analysts' average estimate. The company, which has forecast lower-than-expected revenue for the quarter, is planning a major shakeup in its media unit. Yahoo has been developing content for its mobile platform to drive user engagement and ad sales as its core online advertising business struggles in the face of stiff competition from Alphabet Inc and Facebook Inc. Investors will look for details on Yahoo's plan to proceed with the spinoff of its stake in Chinese e-commerce company Alibaba Group Holding Ltd, despite running into hurdles with the U.S. Internal Revenue Service. Housing starts and building permits for September are expected to show a gain from the previous readings. Groundbreaking is likely to have increased to a seasonally adjusted annual pace of 1.15 million units from 1.13 million units in August, and building permits are predicted to have advanced to a 1.164 million-unit pace from a 1.161 million-unit pace in August. (0830/1230) Federal Reserve Chair Janet Yellen gives welcome remarks, and Labor Secretary Thomas Perez and Bureau of Labor Statistics (BLS) Commissioner Erica Groshen will participate in the Labor Hall of Honor induction ceremony for former BLS commissioners Carroll Wright and Janet Norwood in Washington. Separately, the Federal Reserve Board Governor Jerome Powell gives introductory remarks before "The Evolving Structure of the U.S. Treasury Market" conference hosted by the Federal Reserve Bank of New York. (0915/1315) Virtualization software maker VMware Inc is likely to report third-quarter profit above analysts' estimates. The primary focus will be around any commentary on the Dell-EMC acquisition as VMware reported preliminary results on October 12. Dell's offer is structured in a way that will give EMC shareholders a special stock that tracks the share price in VMware, which is majority owned by EMC. Analysts have said Dell's plan to create a VMware tracking stock will likely hit the company's share price as the size of the float increases. Large trust bank Bank of New York Mellon Corp reports earnings for the third quarter. Analysts will be looking to see the impact of a software glitch that kept the bank from properly producing fund valuations to clients over the summer. Lockheed Martin Corp, the Pentagon's largest arms supplier, reports its earnings for the third quarter. Wall Street is expecting earnings of $2.72 per share, down from $2.76 a year earlier, according to Thomson Reuters I/B/E/S. Chipotle Mexican Grill Inc is Wall Street's favorite restaurant chain, but investors are losing patience with the chain's cooling sales. Investors will want to know whether the end of its carnitas crisis returns the company to stronger growth when it reports third-quarter results. Advertising company Omnicom Group Inc is expected to report third-quarter profit above the average analyst estimate as it benefits from higher advertising spending by U.S. businesses. The owner of agencies such as BBDO Worldwide, TBWA Worldwide and Goodby Silverstein & Partners has also witnessed a growth in its programmatic advertising business. Investors will be looking for the impact of a strong dollar on the company's international revenue. Device maker Intuitive Surgical Inc is expected to report better-than-expected third-quarter revenue, helped by higher sales of its Endowrist device and also of its flagship surgical systems. Analysts will be looking to see whether currency headwinds, which are expected to worsen in the second half of the year, drag margins down. All 40,000 union members at Fiat Chrysler Automobiles U.S. will vote on a proposed new contract, rather than stretch the balloting over more than a week as was done in the recent failed vote. The Fiat Chrysler United Auto Workers members rejected by a nearly 2-to-1 margin last month a proposed four-year contract deal. It was the first such proposal rejected in three decades by workers at a major U.S. automaker. Now, a different and arguably richer deal is being voted up or down over a two-day vote. Canadian Pacific Railway Ltd is expected to post a higher third-quarter profit, helped by strong freight volumes and improved operating efficiency. However, investors will want to know about the future demand as weak oil prices could erase the cost advantage railroads have over truck operators. The company had already cut its full-year earnings forecast and predicted missing analysts' estimates this year. Investors will also want to know about how the company plans to improve its margins and its capital budget plans. The value of Canadian wholesale trade is expected to have increased in August. Economists forecast a gain of 0.2 percent in August, compared to its unchanged reading in July. (0830/1230) LIVECHAT: FOREX FOCUS with FX Live Analytics' Adam Button Getting a fix on the euro or yen has been a tough chore with the Fed keeping markets guessing about an interest rate lift-off. Join Adam Button of FX Analytics Live for a discussion about the pressures building in currencies. (1000/1400) To join the Global Markets Forum, click here bit.ly/1kTxdKD (All references to a company's results expected to beat or miss analysts average estimates are according to Thomson Reuters StarMine, unless mentioned otherwise) (Compiled by Sourav Bose in Bengaluru; Editing by Sriraj Kalluvila)
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