What to Watch in the Day Ahead - Wednesday, Nov. 5
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ADP is expected to report that U.S. private sector payroll growth accelerated slightly in October, with 220,000 new positions being added (0815/1315). Financial data firm Markit releases its final services PMI data for October (0945/1445) and the Institute of Supply Management releases services sector data for October (1000/1500). Time Warner Inc is expected to report third-quarter results slightly below analysts' estimates, according to Thomson Reuters StarMine data. Time Warner said in October that it was launching HBO through Internet-connected devices that can bypass cable and satellite distributors. As there were scant details about the HBO standalone product, analysts will look for any progress on that front, including the price and partnerships. CBS Corp's third-quarter earnings are likely to come below the average analyst estimate, according to Thomson Reuters StarMine data. Weak advertising and a decline in television licensing revenue has been a drag on CBS, which airs hit shows such as "The Big Bang Theory" and "NCIS". The broadcaster, which owns the most-watched U.S. television network, had earlier said that it expected the second half of the year to be stronger, driven by heavy spending on political advertising due to mid-term elections scheduled in Florida and Michigan, markets with CBS-owned stations. CBS also launched a digital video-on-demand and live-streaming service in October to win back viewers who are increasingly turning to the Internet for entertainment. Federal Reserve Bank of Minneapolis President Narayana Kocherlakota speaks on "Clarifying the Objectives of Monetary Policy" before the Laurentian Chamber of Commerce in Virginia (0915/1415). Separately, Federal Reserve Bank of Richmond President Jeffrey Lacker speaks on "Committing to Financial Stability" before the "Financial Stability after Dodd Frank: Have We Ended Too Big to Fail?" conference sponsored by the George Washington University Center for Law, Economics and Finance (C-LEAF), Stanford Graduate School of Business and the Max Planck Institute for Research on Public Goods and Better Markets, in Washington. (0930/1430) Tesla Motors Inc will report its third-quarter results. The focus will be on the progress towards the launch of the Model X SUV and the construction of its battery gigafactory. Analysts have speculated the Model X launch could be delayed, but the company has not said that. Tesla is on track to build the lithium-ion battery factory in the United States and investors will be looking for more details on that schedule. Qualcomm Inc's fourth-quarter results may take a backseat to persistent concerns about its prospects in China, where it faces a murky government antitrust probe. For now, however, the largest maker of microchips for mobile devices continues to benefit from rapid, if slowing, global growth in smartphones and tablets. Chesapeake Energy Corp is due to report third-quarter earnings and provide an update on its goals to cut costs and debt. Its earnings are likely to have been hit by weak prices for natural gas and natural gas liquids, especially in the Marcellus Shale, where a lack of infrastructure has hurt the market. Duke Energy Corp is expected to report a higher profit for the second straight quarter, helped by cost cuts and increasing power demand in North Carolina, South Carolina and Florida. The company, which gets nearly 87 percent of its revenue from electric utilities, has benefited from higher power prices set by regulators. Duke Energy, which has been trying to exit the volatile wholesale power markets, sold some Midwest power assets in August. When the company reports third-quarter results, investors will want to know about the future of its utilities holdings and demand. Continental Resources Inc, the largest oil producer in North Dakota's Bakken oil formation, is expected to post a jump in third-quarter profit. The results will be the first after an expected ruling in CEO Harold Hamm's divorce ruling, which could split the company in half. Refiner HollyFrontier Inc is expected to report a higher third-quarter profit, helped by healthy gross margins for auxiliary products such as coke and asphalt. However, the focus this quarter will be on how the refiner is being affected by a steep drop in global oil prices. Offshore oil and gas drilling services provider Rowan Co is expected to report a higher third-quarter profit due to higher rates for its drilling services. Investors will be looking at the company's ability to renew contracts for its offshore rigs in an oversupplied market. Pipeline company Enbridge Inc is scheduled to report third-quarter results. The company reported a stronger-than-expected profit in the second quarter, driven mainly by higher shipment volumes on the Mainline and on its regional oil sands systems. Kinross Gold Corp is expected to report a drop in third-quarter net income and revenue, reflecting declines in the price of bullion. The Toronto-based miner, which has operations in North and South America, Africa and Russia, will be watched for news on expansion plans for its Tasiast mine in Mauritania - notably any budget changes for the $1.6 billion project and financing plans. Investors will also watch for any comments on the resumption of dividend payments or developments at its La Coipa mine in Chile. Kinross said in July it had decided to start work on a pre-feasibility study for La Coipa, after suspending operations in late 2013. Cash-strapped miner Molycorp Inc is expected to report a third-quarter loss and revenue nearly unchanged from the year-earlier period, as it sold more rare earth but at lower prices. Investors will look for comments on the company securing additional funds to ramp up operations at its flagship Mountain Pass facility in California, for which it secured a loan of $400 million from Oaktree Capital Management in August. Fertilizer producer CF Industries Holdings Inc reports third-quarter results after markets close. The nitrogen producer, which recently broke off merger talks with industry leader Yara, is expected to earn less profit with weak crop prices and a late harvest dampening farmers' fertilizer buying. Investors worried about decelerating same-store sales at Whole Foods Market Inc are bracing for the natural and organic food seller's forecasts for fiscal 2015 when it reports fourth-quarter results. Whole Foods is losing its grip on the niche it pioneered amid competition from rivals ranging from specialty grocers like Sprouts and Fresh Market to mainstream food sellers Wal-Mart and Kroger. IT services provider Cognizant Technology Solutions Corp is likely to report third-quarter revenue below estimates as it expects delays in booking revenue from large deals, which the company's CEO attributed to leadership changes at some North American and UK clients. Second-largest U.S. life insurer Prudential Financial Inc's third-quarter revenue and profit are expected to come below analysts' estimates, according to Thomson Reuters StarMine data. The Japanese yen, which fell about 8.2 percent against the U.S. dollar in the third quarter, is likely to hurt the company as it earns more than half of its revenue from international operations, mainly Japan. Canada's No.3 life insurer Sun Life Financial Inc reports third-quarter results. The company is expected to report earnings per share of 74 Canadian cents, helped by double digit revenue gains from a year earlier. Symantec Corp, which makes Norton antivirus software, is expected to post a second-quarter profit below the average analyst estimate, according to Thomson Reuters StarMine data. Its antivirus business has been hurt by slowing computer sales and sluggish demand for its storage and data management software continues to hurt its other business. 3D printer maker Stratasys Ltd is likely to report a third-quarter profit above analysts' estimates, according to Thomson Reuters StarMine data. The company, which holds 55 percent of the market for printers priced at over $10,000, had raised its full-year forecast in August due to strong demand for its 3D printers. The company is also expected to face higher competition as other traditional printer makers such as HP have announced plans to enter the 3D printing market with faster and cheaper technology. Analysts and investors are looking for guidance in the context of competition from HP. With newspapers struggling, News Corp has been spending its money in interesting places including real estate listing site Move Inc - its biggest acquisition to date. News Corp reports first-quarter results and investors will watch for whether the acquisitions have paid off. WellCare Health Plans Inc's third-quarter revenue and profit are expected to come below estimates, according to Thomson Reuters StarMine data, owing to delays in reimbursements of an annual tax paid by health insurers to the U.S. federal government. At the same time, Medicaid plan managers like WellCare and peers Centene and Molina have seen an increase in patient volumes due to the expansion of the Medicaid program under Obamacare. Investors will focus on the increase in patient numbers and total medical costs of the company, which halved its full-year adjusted profit forecast in the second quarter. October consumer confidence data for Mexico is scheduled for release. The index hit a three-month high in September as shoppers became more optimistic about the outlook for the country's economy (0900/1400). (Compiled by Ayesha Sruti Ahmed in Bangalore; Editing by Kirti Pandey)
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