October 29, 2015 / 6:39 PM / 3 years ago

What to Watch in the Day Ahead - Friday, Oct 30

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Exxon Mobil Corp, the world's largest publicly traded oil company, and Chevron Corp are expected
to report a drop in third-quarter results amidst the slump in crude oil prices. In addition to
the crude oil rout, the second-largest U.S. oil producer Chevron's quarterly profit is likely to
be affected by the high costs of its multiple megaprojects around the globe.
CVS Health Corp's third-quarter revenue is likely to come in above analysts average estimate,
according to Thomson Reuters StarMine. The No. 2 U.S. drugstore chain operator had said profit
was being hurt by low reimbursement rates for generic drugs, which are getting more expensive,
and lower customer traffic after the company stopped selling tobacco products. However, the
company's pharmacy benefit management business is likely to be helped by the distraction to
rival Catamaran Corp, which is getting acquired by UnitedHealth Group.
AbbVie Inc is expected to report a third-quarter profit above analysts average estimate,
according to Thomson Reuters StarMine, helped by strong sales of its arthritis and hepatitis C
drug. However, investors will be looking for commentary on the warning issued by the U.S. Food
and Drug Administration on the potential risk of serious liver injury for certain patients using
its hepatitis C treatments.
Mylan NV, which has been pursuing smaller rival Perrigo since April, is expected to report
third-quarter revenue marginally above analysts average estimate, according to Thomson Reuters
StarMine. Investors' focus, however, will be on the looming Nov. 13 deadline when Mylan's tender
offer expires.
Anheuser-Busch InBev, the world's largest beermaker, is expected to report a 6.7 percent fall in
third-quarter core profit, according to the average estimate of a Reuters survey. Brewer
SABMiller Plc recently extended until Nov. 4 the deadline for Anheuser-Busch InBev to make a
formal $100 billion-plus takeover offer.
Colgate-Palmolive Co is likely to report third-quarter sales below analysts average estimate,
according to Thomson Reuters StarMine. The impact from the strong dollar is likely to have
worsened in the quarter as the personal care products maker has a large presence in Latin
America, where many currencies are down since July 31, particularly the Brazilian real.
U.S. consumer spending likely rose in September, offering confirmation that domestic demand
remains solid despite a softening global economy. Economists forecast consumer spending rising
0.2 percent last month after increasing 0.4 percent in August. (0830/1230) Separately, the
University of Michigan's final index for October on overall consumer sentiment likely rose to
92.5, a bit higher than the final reading of 92.1 in September. (1000/1400) Employments costs in
the third quarter, meanwhile, probably increased 0.6 percent. (0830/1230)
Federal Reserve Bank of San Francisco President John Williams participates in a discussion on
"Where Interest Rates Will Be When the Economy is (Finally) Healthy and Why It Matters" at an
event hosted by the Brookings Institution. (1050/1450) Meanwhile, the Board of Governors of the
Federal Reserve System will hold an open meeting to discuss a proposed rule establishing total
loss-absorbing capacity and long-term debt requirements for global systemically important
banking organizations, as well as a final rule on margin and capital requirements for uncleared
swaps of prudentially regulated swap entities. (1430/1930)
Asset manager Legg Mason Inc is scheduled to report second-quarter results. Analysts will look
to see if the company reports soft flows due to choppy markets in the period.
Eaton Corp Plc, a maker of electrical and hydraulic products, anticipates revenue for the third
quarter below its previous forecast, primarily due to weak organic growth. Investors will be
looking for comments on impacts from currency swings that have been biting into the diversified
manufacturer's sales and updates on the restructuring program it announced in July.
Refiner Phillips 66 is expected to report a rise in third-quarter profit, helped by robust
demand for refined products and lower crude costs. Investors will be looking out for comments on
utilization rates and refinery turnarounds. The company has also set a lower capital budget for
2016 and is planning to increase dividends next year.
Integrated Canadian oil producer Imperial Oil Ltd is expected to show weak third-quarter
earnings. Despite a torrid quarter, the company has been ramping up production at its Kearl oil
sands mine in northern Alberta and is expected to report higher production volumes. Investors
will be watching closely for any hint Imperial may be interested in submitting a counter-offer
for Canadian Oil Sands, currently the subject of a hostile takeover bid from Suncor Energy.
When Canada's uranium producer Cameco Corp reports third-quarter results, investors' focus will
be on whether it raises production guidance for its newest mine, Cigar Lake. An increase would
be good news for the company, but mildly bearish for the oversupplied global uranium market.
Canadian integrated producer oil and gas producer Husky Energy Inc will have some cushion
against low global crude prices thanks to its refining business, but is expected to report a
weak third-quarter, in line with its peers.
Investors will keep an eye on Canadian gross domestic product (GDP) for August to gauge how the
economy for the third quarter is shaping up. The GDP is expected to have picked up by 0.1
percent in the month, reinforcing the view that growth is rebounding after a mild recession in
the first half of the year. (0830/1230)
Colombia's central bank is likely to raise its benchmark interest rate by a quarter point,
according to a recent survey of analysts. Meanwhile, Chile's jobless rate for the
July-to-September period is expected to have risen to 6.6 percent.
LIVECHAT: The Week Ahead - with Reuters markets editor Nigel Stephenson
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 (Compiled By Nayyar Rasheed in Bengaluru; Editing by Savio D'Souza)
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