What to Watch in the Week Ahead and on Monday, Nov 16
(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 Markets will work through another spate of economic figures that include consumer-level inflation and industrial production as they try to decipher whether the Fed is serious about moving in December, and whether the economy is strong enough for a rate increase. On Tuesday, the Federal Reserve is expected to show a gain of 0.1 percent in industrial output for October. Data on the same day is expected to show that consumer prices increased 0.2 percent in October, countering their biggest drop in eight months in September. The steady rally in the dollar has persisted, as investors build bigger short positions in the euro and yen, and the yield curve continues to flatten, suggesting further digging in amongst those who believe the Fed will raise rates but that inflation will remain short of the goal. The equity market's lousy week suggests lack of buying interest and a possible test of a lower end of the recent range - led lower still by energy and materials, two sectors hit hard by sagging commodities prices. Separately, on Wednesday, housing starts are predicted to have decreased to a seasonally adjusted annual pace of 1.16 million units, comparing to its solid increase of 1.21 million units in September. On Wednesday, Federal Open Market Committee will issue minutes from its meeting on Oct. 27-28. Wal-Mart Stores Inc is scheduled to release third-quarter results on Tuesday. Wall Street expects the company to post earnings of 98 cents per share, down from $1.15 a year earlier, according to Thomson Reuters I/B/E/S. Margins at the retailer have come under pressure due to costs related to entry-level wages, investments in e-commerce and competition from Amazon.com, as well as regional supermarkets and dollar stores. Separately, Target Corp is scheduled to report third-quarter earnings on Wednesday. Chief Executive Brain Cornell, who took over in August last year, has focused on core categories such as baby, kids and wellness products, even as he has exited the money-losing foray in Canada and laid off thousands of employees. Home Depot Inc, the No. 1 U.S. home improvement company, is expected to report third-quarter sales above analysts' average estimate on Tuesday, according to Thomson Reuters StarMine. Meanwhile, closest rival Lowe's Cos Inc's third-quarter profit will likely be in-line with estimates on Wednesday. Both companies are expected to have benefited from an improving U.S. housing market. But in the face of competition from big-box and online retailers, where Home Depot raised its full-year forecast last quarter, Lowe's maintained its numbers, giving investors some reason for caution. Better interconnectedness between stores has given Home Depot an edge over Lowe's and online players like Amazon, and Lowe's may lose out in the race to cater to millennials. On Wednesday, Federal Reserve Bank of Cleveland President Loretta Mester, Federal Reserve Bank of New York President William Dudley and Federal Reserve Bank of Atlanta President Dennis Lockhart participate in "Federal Reserve Perspectives" discussion before the Clearing House Annual Conference in New York. On Thursday, Dennis Lockhart speaks before the "Economic Outlook and Financial Impact 2016" event hosted by the DeKalb Chamber of Commerce. Meanwhile, Federal Reserve Bank of St. Louis President James Bullard will be speaking on the economy and monetary policy before the Fort Smith Chamber of Commerce on Friday. Also, Federal Reserve Board Governor Jerome Powell is scheduled to speak before the Clearing House Annual Conference on Tuesday. Off-price retailer TJX Companies Inc is expected to report third-quarter profit above analysts' estimates on Tuesday, according to Thomson Reuters StarMine. TJX, which sells clothing, merchandise and accessories at low prices, is expected have gained from lower gas prices, wage growth and higher traffic to its stores as more consumers hunt for bargains. The retailer raised its full-year profit forecast for a second time in August. Best Buy Co Inc, the biggest U.S. consumer electronics retail chain, is expected to report on Thursday third-quarter profit above analysts' estimates, according to Thomson Reuters StarMine. Sales of Apple's new iPhones, launched during the quarter, is expected to have helped the company. On Friday, teen apparel retailer Abercrombie & Fitch Co is expected to report a third-quarter profit below the average analyst estimate, according to Thomson Reuters StarMine. Abercrombie's sales have fallen for 10 quarters in a row as it faces intense competition from fast-fashion retailers, and teens prefering to spend on electronics rather than on clothing. On Thursday, apparel retailer Gap Inc is expected to report third-quarter profit below analysts' estimates, according to Thomson Reuters StarMine. Out of fashion merchandise and a general lack of trendy products have led to falling sales at the company's flagship Gap brand, forcing the company to discount heavily to bring in customers. Footwear retailer Foot Locker Inc is expected to report third-quarter profit and sales above analysts' estimates on Friday, according to Thomson Reuters StarMine. Analysts expect Foot Locker's sales and gross margin growth to be driven by higher demand for basketball, casual and running shoes, particularly for Nike Inc's Jordan brand. J.M. Smucker Co, known for its Folgers coffee and Jif peanut butter, is likely to report second-quarter sales slightly above analysts' average estimate on Thursday, according to Thomson Reuters StarMine. The company's sales have been boosted by higher demand for Dunkin' Donuts K-Cup pods, introduction of smaller cans of its Folgers coffee and lowered prices. Square Inc, the mobile payments company founded by Twitter CEO Jack Dorsey, is expected to raise up to $403.7 million after its IPO is priced at between $11 and $13. Square, set to be valued at up to $3.8 billion after its debut on Thursday, is one of the year's most highly anticipated listings as investors worry about how Dorsey will split his time between Square and Twitter. On the same day, going head-to-head with Square's high-profile debut will be Match Group. The owner of dating services such as Tinder, OkCupid and Match.com expects to raise up to $466.7 million in an initial public offering, valuing it at as much as $3.43 billion. NetApp Inc is expected to report second-quarter revenue slightly above the average analyst estimate on Wednesday, according to Thomson Reuters StarMine. The data storage equipment maker has been migrating its customers to its next generation storage operating system, clustered Data ONTAP, and hopes to derive majority of its revenues in future from the system. Chipmaker Marvell Technology Group Ltd is expected to report fourth-quarter revenue and profit below estimates on Thursday, according to Thomson Reuters StarMine. Marvell's auditor PwC unexpectedly resigned in October, saying the company needed to expand an ongoing audit investigation into other areas. Investors will look out for comments on the investigation. Cloud software company Salesforce.com Inc is expected to report third-quarter earnings above analysts' average estimate on Wednesday, according to Thomson Reuters StarMine. Salesforce has been helped by higher demand for its web-based sales and marketing software, and as businesses opt for cheaper and easier cloud software services. Investors will look for plans to improve margins as higher spending, particularly on sales personnel, has pressed the bottom line. On Thursday, software maker Workday Inc is expected to report third-quarter revenue above analysts' estimates, according to Thomson Reuters StarMine. The company has been benefiting from strong subscription growth for its web-based human resource management software. Investors will be looking for Canada's inflation and retail sales data on Friday. The annual inflation rate is expected to remain unchanged at 1.0 percent in October from September, according to a survey. Retail sales probably rose 0.2 percent in September. Meanwhile, in Thursday's release, economists forecast the value of Canadian wholesale trade to have gained 0.3 percent in September. ON MONDAY, NOVEMBER 16 Apparel retailer Urban Outfitters Inc is expected to report profit below analysts' estimates, according to Thomson Reuters StarMine. In August, the Philadelphia-based retailer had said same-store sales growth in the third quarter was slower than in the previous three months. Analysts have said that the long spell of warm weather in September and October, which hurt sales of cold weather apparel like coats and jackets, could hurt the company. Investors will look for commentary on promotions and sales forecast for the holiday quarter. The world's most powerful money managers and hedge-fund investors, ranging from Seth Klarman's Baupost Group and Warren Buffett's Berkshire Hathaway to Bill Ackman's Pershing Square Capital Management and David Einhorn's Greenlight Capital, disclose which U.S. stocks they held at the end of the third quarter via 13-F SEC filings. It'll shed light on how they positioned their portfolios before September's Federal Reserve policy-setting meeting, a slowdown in growth in China and the volatile global financial markets. Statistics Canada is scheduled to release manufacturing sales data for September. Factory sales are expected to have risen 0.1 percent in September. (0830/1330) Separately, the agency will also be releasing the figures for foreign investment in Canadian securities in September. 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For more, click here: here LIVECHAT - FX Week Ahead with Reuters FX analyst Jeremy Boulton Join Reuters FX analyst Jeremy Boulton at 0500 ET/1000 GMT 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 Sriraj Kalluvila)
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