What to Watch in the Week Ahead and on Monday, Nov 9
(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) WEEK AHEAD A stronger-than-expected jobs report has put the markets in a rosier mood even if data points more firmly to a Federal Reserve rate hike in December. The recent rally in the equity market suggests comfort with the Fed's intentions. However, next week might see a bit of selling as stocks aren't far from all-time highs. Bonds could continue their upward trajectory with flattening between the short- and long-dated part of the curve, and the dollar should continue to be favored over other major currencies. Cisco Systems Inc is expected to report first-quarter revenue and profit above analysts' estimates on Thursday, according to Thomson Reuters StarMine. The network equipment maker is expected to benefit from a recovery in sales of its switches and routers. Investors will look for details on Cisco's security business, where revenue has been growing steadily. Cisco is also working on a joint venture with Chinese server maker Inspur to offset the impact of weakness in its U.S. business. The Labor Department releases its producer price index (PPI) for October on Friday. The PPI is forecast to have gained 0.2 percent last month after declining 0.5 percent in September. Meanwhile, the Commerce Department will release retail sales data on the same day. Retail sales are expected to have increased 0.3 percent in October. Economists have also projected a slight decline in import prices last month. The prices, scheduled to be released on Tuesday, are estimated to have dropped 0.1 percent in October. The University of Michigan's preliminary index on overall consumer sentiment, scheduled to be released on Friday, is expected to have risen to 91.5 in November from 90.0 in October. Chip equipment maker Applied Materials Inc is set to report fourth-quarter revenue and profit in line with analysts' expectations on Thursday, according to Thomson Reuters StarMine. Reports of declining capex spending among chipmakers have hit equipment makers such as Applied Materials the hardest. Investors will want to know how the company can register a recovery on its stuttering foundry sales and how it combats a slowdown in Intel Corp. Department store operators Macy's Inc and Kohl's Corp are expected to report third-quarter sales below analysts' estimates, according to Thomson Reuters StarMine. Macy's results are scheduled for release on Wednesday and Kohl's on Thursday. In addition to a strong dollar, their sales have been hurt by heavy discounts as the unseasonally warm weather in September and most of October led to shoppers delaying purchases of cold weather apparel and footwear, which department stores stock up on mainly in these months. JC Penney Co, which reports its third-quarter results on Friday, is less likely to have been hurt by unseasonal weather. The company is expected to report a quarterly loss smaller than analysts are expecting, according to Thomson Reuters StarMine. JC Penney is expected to benefit from higher sales at beauty brand Sephora's outlets, which are now present in almost half of Penney's stores. D.R. Horton Inc, the No.1 U.S. homebuilder, is expected to report a rise in fourth-quarter revenue and profit on Tuesday, helped by higher home sales. Investors want to see how D.R. Horton coped with labor shortages, which led to construction delays for smaller rival PulteGroup Inc in the period and caused its profit to fall more than a fifth. Federal Reserve Chair Janet Yellen will give welcome remarks in Washington on Thursday before the "Federal Reserve Conference on Monetary Policy Implementation and Transmission in the Post-Crisis Period." At the same event, Fed Vice Chair Stanley Fischer will speak on "Incorporating Financial Stability into Monetary Policy." Also on Thursday, Federal Reserve Bank of St. Louis President James Bullard speaks on the economy and monetary policy before the Cato Institute 33rd Annual Monetary Conference, "Rethinking Monetary Policy". The same day, Federal Reserve Bank of Chicago President Charles Evans will be speaking on current economic conditions and monetary policy before the Communities Council Fall Leadership Forum: "Inspiring Ideas, Transforming Communities". Thursday also sees Federal Reserve Bank of New York President William Dudley speak on "The Economic Outlook and What it Means for Monetary Policy," before the Economic Club of New York. Viacom Inc, the owner of MTV, Comedy Central and Nickelodeon, is expected to report on Thursday a fourth-quarter profit below the average analyst estimates, according to Thomson Reuters StarMine. The company has been hurt by lower advertising revenue from its U.S. cable TV business as viewers increasingly shift to online streaming services. Investors will await commentary around viewership changes in the United States and signs of stability in the cable TV business. Chemicals and seeds company DuPont has been talking to rivals about its struggling agriculture business and it will discuss its strategy with investors on Thursday. The company has come under pressure from activist investor Nelson Peltz for failing to meet earnings targets. Peltz has called for a separation of its volatile businesses from its more stable ones. Interim Chief Executive Edward Breen is looking to streamline the company's cost structure to avert a second proxy war with Peltz. Canadian natural gas producer Encana Corp is expected to report a third-quarter loss on Thursday, compared with a year-earlier profit, hurt by a prolonged slump in oil and gas prices. Encana has been selling off natural gas assets to cut its net debt by $3 billion by the end of the year. Investors will be keen on knowing more about the company's divestitures and efforts to improve cash flow. ON MONDAY, NOVEMBER 9 Priceline Group Inc is set to report third-quarter results. Travel bookings on the company's websites are expected to have risen in the quarter. Analysts will be looking at whether the pressures of a strong dollar eased in the third quarter and whether Priceline Group, the most profitable online travel services company in the world, expects them to ease in the fourth quarter. Wall Street will want greater clarity on the prospects for its latest acquisition, AS Digital. DISH Network Corp, the No.2 U.S. satellite TV company, is expected to report third-quarter profit and revenue above analysts' estimates, according to Thomson Reuters StarMine. Investors will look for details on the company's strategy to amass spectrum without building out infrastructure to offer its own wireless service as well as any comments on the Time Warner Cable-Charter Communications deal. U.S. solar company SunEdison Inc is expected to report a bigger quarterly loss, hurt by lower sales and higher costs in the third quarter. SunEdison, which was among the first to spin off some of its power plants into a yieldco, said last month that it no longer planned to sell any assets to its yieldcos. Investors will want to know more about its plans. Dean Foods Co, the largest U.S. milk processor, is expected to report third-quarter profit slightly above the average analyst estimate, according to Thomson Reuters StarMine. Analysts expect Dean Foods to announce capacity reduction plans to counter the drop in sales. Federal Reserve Bank of Boston President Eric Rosengren will be speaking on the economic outlook at the Newport County Chamber of Commerce Economic Update Luncheon in Portsmouth. (1230/1730) Coal miner Arch Coal Inc, which is nearing bankruptcy, is expected to report a bigger quarterly loss in its third-quarter report. Investors will focus on comments around the company's restructuring plan. Canadian housing starts are expected to have fallen in October from September. The seasonally adjusted annualized rate of housing starts probably fell to 200,000 in October from 230,701 the prior month. (0815/1315) Focus will be on Mexico's inflation data for October, after the annual inflation rate came at a new record low the prior month, cooling to 2.52 percent in the 12 months through September. (0900/1400) Chile is also scheduled to report its October trade deficit. LIVECHAT - FX Week Ahead with Reuters FX analyst Jeremy Boulton Join Reuters FX analyst Jeremy Boulton at 0500/1000 for a look at the week's top topics and implications for the FX market. To join the Global Markets Forum, click here bit.ly/1kTxdKD (Compiled by Nayyar Rasheed in Bengaluru; Editing by Kirti Pandey)
© Thomson Reuters 2017 All rights reserved.