What to Watch in the Day Ahead - Tuesday, Dec 1

Mon Nov 30, 2015 2:50pm EST
 
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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) U.S. factory activity likely ticked up in November, which would offer more evidence that manufacturing was turning a corner after being weighed down by a strong dollar and deep spending cuts in the energy sector. According to a Reuters survey, the Institute for Supply Management will likely report that its national factory index rose to 50.5 last month from a reading of 50.1 in October. (1000/1500) Separately, the Department of Commerce is likely to report construction spending for October at 0.5 percent. (1000/1500) Automakers will report sales figures for November.

U.S. grocery retailer Albertsons Companies Inc is expected to raise as much as $1.7 billion in its IPO, valuing the company at about $12.35 billion. The No.2 U.S. grocery chain postponed its IPO in October amid weaker-than-expected demand from investors, Reuters exclusively reported. The company is going public at a time when investors have been giving most IPOs a cold reception since the stock market plunged in August.

The Federal Reserve Bank of Chicago President Charles Evans speaks on current economic conditions and monetary policy before the Lansing Regional Chamber of Commerce Economic Club Luncheon.

Canada's gross domestic product report is expected to confirm that the economy pulled out of recession in the third quarter, with growth forecast to ramp up to a 2.4 percent annualized rate. However, monthly figures are expected to show no growth for September, suggesting the third quarter ended on a weak note. (0830/1330) Separately, auto makers, who expect 2015 to be a record year for the sale of Canadian vehicles, report sales figures for November.

Bank of Nova Scotia and Bank of Montreal, Canada's third and fourth biggest banks, are expected to report higher quarterly earnings for the fourth quarter. Investors remain concerned about the weakness in the oil price and its impact on the lenders. The quarterly report could show signs of increasing gross impaired loans and possible write-downs.

European Central Bank publishes Target 2 balances. The Target 2 system facilitates payments between banks in different euro zone countries by channeling them through each national central bank's account at the ECB. Cross-border payment imbalances increased during the 2010-2012 euro zone debt crisis as the private sector withdrew capital and banks turned to the ECB for funding because banks from the stronger economies stopped lending to them. Italian and Spanish net liabilities have declined from their 2012 peak while Greece's have increased again since late 2014, along with political uncertainty in the country. The ECB said it would now publish Target 2 data on the first working day of every month, albeit with a one-month time lag.

Brazil's economy probably shrank at the fastest annual pace on record in the third quarter, crippled by a combination of government budget cuts, rising inflation and political gridlock. The gross domestic product in Latin America's largest economy likely contracted 1.2 percent in the third quarter from the second after seasonal adjustments, following a decline of 1.9 percent between April and June. (0830/1130)

The closely watched survey of economists by the Mexico central bank, which sheds light on analyst expectations for growth and inflation, is scheduled for release.

LIVECHAT- CURRENCY CORNER with FX analyst Kathy Lien of BK Asset Management Kathy sketches out a year-end trading strategy turning on differences in monetary policies among the Federal Reserve and other central banks while taking questions on prospects for the euro and the yen after Japan's fall into recession. To join the Global Markets Forum, click here bit.ly/1kTxdKD (Compiled by Nikhil Kumar; Editing by Maju Samuel)