July 30, 2015 / 6:38 PM / 3 years ago

What to Watch in the Day Ahead - Friday, July 31

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Exxon Mobil Corp, the world's biggest listed oil company, and its U.S. peer, Chevron Corp, are
scheduled to post second-quarter earnings. Exxon's profit is expected to nearly halve. Recently
Chevron, the second-largest U.S. oil company, said it would lay off 1,500 employees, or about 2
percent of its global workforce. 
The U.S. Employment Cost Index, the broadest measure of labor costs, is likely to have advanced
0.6 percent in the second quarter, down from an increase of 0.7 percent in the first quarter.
(0830/1230) Separately, the University of Michigan's final July reading on the overall index on
consumer sentiment is expected to come in at 94.0, a bit higher from a preliminary reading of
93.3. (1000/1400)
Royal Caribbean Cruises Ltd, the world's second-largest cruise operator, is expected to report
second-quarter profit and sales below analysts' average estimates, according to Thomson Reuters
StarMine, hurt by higher fuel costs and a strong dollar. Increased promotional and marketing
spending is likely to hurt margins as well. However, the company is likely to benefit from its
partnership with online travel company Ctrip, which could lead to an increase in revenue from
the Asia-Pacific. Investors will be looking for revisions to its full-year forecasts, as the
company heads into peak summer - its busiest time of the year.
Negotiations on a Pacific Rim trade deal are due to wind up after an intense round of talks
among ministers from the dozen nations aimed at sealing a deal. The deal, which covers 40
percent of the global economy and is expected to deliver $295 billion in annual global economic
gains, will have long-term implications for Pacific Rim companies.
Canada's economic growth is expected to have stalled in May, boding poorly for the possibility
of a rebound in the second quarter. The monthly figures will be watched more closely than usual
after the economy shrank in the first quarter and other indicators have shown the second quarter
had gotten off to a weak start. That puts the economy at risk of having fallen into recession in
the first half of the year as oil-exporting Canada has been hit by the lower price of crude.
Enbridge Inc, Canada's largest oil pipeline company, is expected to report a higher
second-quarter profit, helped by increased throughput. Pipelines companies have seen strong
demand as more crude is increasingly moved by pipeline rather than rail. Pipeline companies have
been shielded from the oil price slump because they have fee-based contracts, but investors will
want to know if the price fall is likely to affect throughput.
Imperial Oil Ltd, Canada's No.2 integrated oil producer and refiner, is expected to report a
fall in second-quarter profit, hurt by the fall in crude oil prices. The company, majority owned
by Exxon Mobil, began production in June at the second phase of its Kearl oil sands mine in
northern Alberta, doubling the capacity of the site to 220,000 barrels per day. The company has
said that it would maintain a cautious spending outlook in the months ahead. Investors will be
looking for any commentary on cost reductions.
TransCanada Corp, Canada's second largest pipeline operator, reports second-quarter results. The
company behind the controversial Keystone XL pipeline project said last month that it had
eliminated 185 jobs following a restructuring of its major projects department. Earlier this
week, Canadian Prime Minister Stephen Harper said he was not hopeful that the United States
would approve the northern leg of the pipeline, which would carry crude for Alberta across the
border to U.S. markets.
ArcelorMittal SA, the world's largest producer of steel, releases its second-quarter results.
The company is likely to show decent steel results for Europe, but its mining has suffered from
a collapse of commodity prices.
CBOE Holdings Inc, the operator of the largest U.S. stock options market, reports second-quarter
earnings. The company's profit and revenue is expected to be in line with analysts' average
estimates, according to Thomson Reuters StarMine. The owner of the Chicago Board Options
Exchange had said last quarter that it would cut expenses in response to weak trading volumes.
Euro Zone's flash inflation forecast is expected to be unchanged at 0.2 percent year-on-year in
July, although weak German figures and a return to deflation in Spain after a flat reading in
July suggest there is a possibility of an even weaker euro zone number. If so, it would
reinforce the case for the ECB to press ahead with and possibly even extend its 1 trillion euro
plus asset-buying programme.
Brazil's central bank releases its monthly report on the federal budget. The primary balance is
a gauge closely watched by investors because it measures a country's ability to service its
LIVE CHAT: The weekahead with Reuters markets editor Mike Dolan
Join Mike Dolan as he goes through the key macroeconomic and political themes for the coming
week at 0600 ET/ 1000 GMT. To join the Global Markets Forum, click here bit.ly/1kTxdKD

 (Compiled by Sourav Bose in Bengaluru; Editing by Savio D'Souza)
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