April 24, 2015 / 7:54 PM / in 3 years

What to Watch in the Week Ahead and on Monday, April 27

(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

The Federal Open Market Committee begins on Tuesday a two-day meeting on interest rate policy. The Fed has already ruled out an April rate hike. So not much is expected from this meeting. Investors will watch for signs that the Fed is getting more comfortable with inflation data. A statement is scheduled for release on Wednesday at 1400 ET (1800 GMT).

Dow components reporting results in the week include Merck & Co Inc and Pfizer Inc on Tuesday, Visa Inc and Exxon Mobil Corp on Thursday and Chevron Corp on Friday. Lower first-quarter earnings are in store for Merck, as weak growth of its Januvia diabetes drug, the stronger dollar and generic competition for other drugs weigh on results. Pfizer is also expected to report lower first-quarter earnings, hurt by generic competition for its Celebrex painkiller and conclusion of a longtime co-promotion agreement that had allowed it to sell Amgen Inc’s blockbuster Enbrel arthritis drug in the United States.

Visa, the world’s No.1 debit and credit card company, is expected to post a slight fall in year-over-year profit for the second quarter, weighed down by a decline in U.S. spending activity in the quarter due to low gas prices, which accounts for about 7-8 percent of the its U.S. transaction volume. MasterCard Inc, second behind Visa, is expected to report a fall in first-quarter revenue on Wednesday, hurt by a stronger dollar and low gas prices. MasterCard gets about 60 percent of its payment volumes from outside the United States.

Data next week will likely show the U.S. economy slowed sharply in the first quarter. The Conference Board is expected to report on Tuesday that consumer confidence index rose to 102.5 in April from 101.3 in March. The same day, the S&P Case Shiller survey is expected to show house prices increased in 20 metropolitan areas in February. The Commerce Department is expected to report on Wednesday that gross domestic product increased at a 1.0 percent annual rate in the first quarter after expanding at a 2.2 percent pace in the fourth quarter. The National Association of Realtors is expected to report pending home sales rose 1.2 percent in March after rising 3.1 percent in February. Data from the Commerce Department is expected to show on Thursday consumer spending rose 0.5 percent in March after edging up 0.1 percent in February. The same day, the Labor Department is expected to report employment cost index rose 0.6 percent in the first quarter, maintaining the pace of the prior quarter. The Commerce Department is expected to report on Friday that construction spending rose 0.5 percent in March after slipping 0.1 percent in February. The Institute for Supply Management is expected to report that its national factory index rose to 52 in April from 51.5 in March. Automobile manufacturers are expected to report that sales moderated to a 16.9 million-unit rate in April after rising to a 17.15 million-unit rate in March.

Ford Motor Co will report results for the first quarter before the market opens on Tuesday. Analysts expect 27 cents a share, up slightly from a year earlier. Focus will be on the company’s U.S. truck business, and its effort to narrow losses in Europe.

Time Warner Inc, which spun off its publishing business Time Inc last year, reports first-quarter results on Wednesday. Cable provider Time Warner Cable Inc is expected to report first-quarter revenue slightly below the average analysts’ estimate on Thursday, according to Thomson Reuters StarMine data as it continues to lose residential video customers. The company and Comcast terminated their pending deal on April 24. Viacom Inc, the owner of cable networks MTV and Comedy Central and movie studio Paramount Pictures Corp, is expected to report second-quarter revenue and profit broadly in line with analysts’ expectations on Thursday, according to Thomson Reuters StarMine data.

Twitter Inc is expected to report on Tuesday an 80 percent surge in first-quarter revenue as the ubiquitous online micro-blogging service manages to make more money from advertisers keen to reach its nearly 300 million users.

LinkedIn Corp, which operates a social network for professionals, is expected to report first-quarter results on Thursday that beats average analysts’ estimate, according to Thomson Reuters StarMine data. Analysts expect LinkedIn’s hiring business, which has been growing by nearly 50 percent in last three quarters, to remain the primary engine of growth by acquisition of new customers. Investors will be looking for second-quarter profit and revenue forecasts.

Satellite radio service Sirius XM Holdings Inc is expected to report a rise in first-quarter profit and revenue on Tuesday as strong U.S. auto sales in the first three months of the year is seen benefiting the company. Investors will be looking for commentary on the company’s 2015 outlook.

Medical equipment maker Boston Scientific Corp is expected to report a slight rise in first-quarter profit on Tuesday, according to Thomson Reuters StarMine data, helped increased sales of its implantable heart devices. On the same day, Bristol-Myers Squibb Co is expected to report a higher first-quarter profit, with sales of its recently approved Opdivo treatment for advanced melanoma helping to offset the negative impact of the stronger dollar.

When Valeant Pharmaceuticals International Inc reports first-quarter results on Wednesday, investors will be looking for fresh hints about the company’s growth plans, even as it digests the $11 billion purchase of Salix Pharmaceuticals. Drug chain CVS Health Corp reports first-quarter results before the markets open on the same day.

Generic drugmaker Mylan NV, which took its $31 billion offer for Perrigo directly to shareholders on Friday, is expected to report on Thursday a slight rise in first-quarter profit, helped by strong demand for its generics in North America with investors watching out for any commentary on Teva Pharmaceutical’s unsolicited $40 billion offer for the company. Also on Thursday, when drugmaker Celgene Corp reports first-quarter results, it is expected to beat Wall Street expectations as it continues to benefit from rising sales of its flagship myeloma drug, Revlimid and Gilead Sciences Inc reports first-quarter results after the markets close. The world’s largest insulin maker Novo Nordisk, reports first-quarter results on the same day.

Health insurers reporting first-quarter results in the week include Aetna Inc on Tuesday, Anthem Inc on Wednesday and Cigna Corp on Thursday.

Textron Inc, the maker of Beechcraft and Cessna aircraft, is expected to benefit from rising demand for its new jets as it realizes the benefits from its Beechcraft acquisition last year. When the company reports first-quarter results on Tuesday, investors will be looking for comments on its Bell helicopters, which gets most of its sales from defense contracts and has been hit as spending remains weak. Northrop Grumman Corp, the maker of Global Hawk surveillance planes, and General Dynamics Corp, the maker of Gulfstream jets, tanks and warships, report first-quarter results on Wednesday.

Consol Energy Inc is expected to report a smaller first-quarter profit on Tuesday, hurt by higher costs and lower coal prices. Investors will look for details on the company’s cost-cutting efforts. On Friday, power company Duke Energy Corp is expected to report a lower first-quarter profit, hurt by rising costs. Investors will want to know about Duke’s expectations for its utilities holdings, demand and international operations.

National-Oilwell Varco Inc, the largest U.S. oilfield equipment provider, is expected to report a lower first-quarter profit on Tuesday as demand dwindles due to a slump in drilling activity. Investors will look for any comments on cost cutting initiatives and the company’s demand outlook. On Wednesday, offshore rig contractor Hercules Offshore Inc, which announced in February it had cut its workforce by nearly a third, is expected to report a first-quarter loss, compared with a year-ago profit. On the same day, offshore driller Noble Corp Plc’s first-quarter profit is expected to fall due to weak demand for rigs. Oil company ConocoPhillips, which in January slashed exploration spending plans for this year, reports first-quarter results on Thursday.

Fertilizer company Mosaic Co reports first-quarter results on Thursday and investors will look at its report to get a sense of spending by farmers in an unusual year. Plummeting grain prices may lead to farmers scrimping on spring fertilizer buys, but Mosaic could also reap the benefits of fertilizer applications delayed from last fall, prior to the early onset of winter.

On Wednesday, iron ore miner Cliffs Natural Resources Inc, which has sought creditor protection for its Canadian arm, is expected to post a smaller loss for the first quarter, helped by lower production costs. On Thursday, coal miner Alpha Natural Resources Inc is expected to report a lower first-quarter profit, hurt by falling coal prices and lower imports from China.

Toronto-based gold miner Yamana Gold Inc is expected to report weaker first-quarter earnings on the back of a lower gold price. Investors will be looking for more details on Yamana’s plans to spin off and list its Brio unit.

Hilton Worldwide Holdings Inc, owner of the Waldorf Astoria hotel brand, is expected to report first-quarter profit below analysts’ estimates on Wednesday, according to Thomson Reuters StarMine data, hurt by a stronger dollar and lower inbound travel to the United States. Rival Starwood Hotels & Resorts Worldwide Inc, which is also expected to report first-quarter results before the markets open on the same day, forecast a fall in profit in January, citing the dollar.

Kraft Foods Group Inc, which said earlier this month that it would combine with ketchup maker H.J. Heinz Co in a $46 billion deal, reports first-quarter results on Tuesday.

Oreo and Cadbury maker Mondelez International Inc will report first-quarter results before markets open on Wednesday. Analysts on average expect the company to beat both sales and profit forecasts, according to Thomson Reuters StarMine data.

Tire maker Goodyear Tire & Rubber Co, which gets more than half its sales from outside North America, is expected to report lower revenue for the first quarter on Wednesday, according to Thomson Reuters StarMine data, hurt by a strong dollar. Investors will look for an update on 2015 forecast and comments on how much lower rubber and oil costs will boost profit in the year.

Rockwell Automation Inc, maker of automation systems, lowered its full-year profit and revenue forecast in January, citing the strong U.S. dollar. When the company reports second-quarter results on Thursday, Rockwell’s investors will also be looking for comments on its performance in Asia, as economic growth slows in the region.

Diversified manufacturer Eaton Corp Plc is expected to report first-quarter results on Wednesday after posting a margin-driven quarterly profit in the fourth quarter.

Western Union Co, the largest payment transfer company, is expected to report a first-quarter profit on Thursday, helped by cost cuts and more people transferring money using its services. Analysts expect Western Union to benefit from stable cross-border pricing and slowing growth of compliance costs.

On Tuesday, McGraw Hill Financial Inc is expected to report a first-quarter profit helped by higher revenue from its bonds ratings business, while Ally Financial Inc’s first-quarter results are likely to benefit from a one-time gain of $400 million, related to a stake sale in its Chinese joint venture. On the same day, mortgage insurer Genworth Financial Inc, one of the few remaining players in the long-term care insurance market, is expected to report a first-quarter profit in line with analysts’ estimates, according to Thomson Reuters StarMine data. On Friday, credit rating agency Moody’s Corp is expected to report a first-quarter profit, helped by strong growth in its analytics business and higher debt issuance in the United States.

On Thursday, Expedia Inc, the world’s second largest online travel services provider, will update investors on the impact of a strong U.S. dollar on its bookings and potentially on progress toward its planned acquisition of Orbitz Worldwide Inc.

On Thursday, consumer products maker Colgate-Palmolive Co is expected to report first-quarter sales below estimates, according to Thomson Reuters StarMine data, hit by a strong dollar. Colgate resorted to raising prices in a bid to buffer the dollar impact, but cut earnings forecast for 2015, stating that currency fluctuations will remain a challenge throughout the year. Investors will look out for updates on the forecast.

Handbag and accessories maker Coach Inc is expected to report third-quarter profit above the analysts’ average estimate on Tuesday, according to Thomson Reuters StarMine data, boosted by fewer discounts and lesser marketing. Investors will look out for third-quarter and full year forecast and updates on transformation plans.

Avon Products Inc, a direct seller of cosmetics, will report first-quarter results before the bell on Thursday. Analysts on average are expecting a profit of 7 cents on revenue of $1.83 billion for the first quarter.

Gorilla glass maker Corning Inc is expected to report first-quarter revenue in line with analysts’ average estimate on Tuesday, according to Thomson Reuters StarMine data, due to a soft mobile phone market. The company also expected its display technologies business volume to be flat to down slightly on a sequential basis.

On Wednesday, Garmin Ltd, maker of GPS-based gadgets, is expected to report first-quarter results slightly above analysts’ average estimate, according to Thomson Reuters StarMine data, helped by sales of its fitness, marine and aviation products. However, Garmin in February said a stronger dollar would slow revenue growth and forecast a profit below market estimates for the full year. Investors will also look for comments on concerns of competition from Apple Watch and other wearable products.

Internet content delivery service provider Akamai Technologies Inc is expected to report first-quarter profit in line with expectations on Tuesday, according to Thomson Reuters StarMine data. Akamai had said that current quarter results would be hurt by the lack of any major sporting events and the impact of a stronger dollar. Analysts will be looking closely to see whether the generally conservative company will forecast second-quarter revenue and profit below expectations.

Cybersecurity firm FireEye Inc will report first-quarter results after the market closes on Thursday. The company has benefited from governments and businesses ramping up spending to protect their networks from increasingly sophisticated attacks. Investors will look for signs of higher demand and updates on sales pf its on-premise equipment.

Harman Industries, owner of brands such as JBL, is expected to post a third-quarter profit above market expectations on Thursday, according to Thomson Reuters StarMine data. Investors will be looking for updates on Harman’s outlook for the year ending June, and for the remainder of calendar 2015.

On Tuesday, wearable camera maker GoPro Inc is expected to report first-quarter profit and revenue above average analysts’ estimates, according to Thomson Reuters StarMine data. Analysts expect sales to grow as GoPro expands overseas and extends the brand to new device categories. Investors will be looking for second-quarter forecast.

Hollywood studio DreamWorks Animation SKG Inc is expected to report on Thursday a first-quarter profit below analysts’ expectations, according to Thomson Reuters StarMine data.

The New York Times Co is expected to report first-quarter profit above analyst’ average estimates on Thursday, according to Thomson Reuters StarMine data. Higher digital subscription and advertising sales have been helping the company balance a fall in print ad revenue.

Solar panel makers SunPower Corp and First Solar Inc are expected to post lower first-quarter revenues on Thursday as they retain power plants, instead of selling them. The companies plan to spin off the units into a limited partnership called 8point3 Energy Partners LP, which they will jointly own. Investors will want to more about the partnership and the cost savings it will generate.

Mexico’s central bank is expected to keep its benchmark interest rate unchanged at 3 percent on Thursday after inflation cooled despite a sharp drop in the peso to a record low in March.

MONDAY, APRIL 27

Apple Inc is expected to post a 20 percent rise in second-quarter profit to around $12.5 billion as iPhone sales continue to surge. Investors will be keen to find out if Apple will share early sales numbers for the new Apple Watch, which was launched after the end of the quarter but is being closely watched for evidence that Apple and CEO Tim Cook can create yet another blockbuster product.

Barrick Gold Corp, the world’s biggest gold producer, is expected to report weaker first-quarter earnings on the back of a fall in gold and copper prices and lower production in the first half of the year. Investors will be looking for an update on Barrick’s plan, unveiled in February, to reduce net debt by at least $3 billion by year-end. To that end, there will be questions about how the planned sales of its Cowal mine in Australia and its Porgera mine in Papua New Guinea are going. Barrick could also announce that it will not suspend operations at its Lumwana mine in Zambia following the country’s recent about-face on raising mining royalties. The company holds its annual meeting on Tuesday in Toronto. The market will focus on a non-binding shareholder vote on Barrick’s executive pay as well as the election of directors.

Financial firm Markit releases preliminary data for its composite and services Purchasing Managers Index. The reading of its Purchasing Managers Index for the services sector is expected to have risen to 59.5 in April from 59.2 in March.

Cable company Charter Communications Inc is expected to report first-quarter revenue below analysts’ estimates, according to Thomson Reuters StarMine data. The company had earlier offered to buy privately held Bright House Networks for $10.4 billion as the U.S. cable TV industry rapidly consolidates. Charter’s advisers have started the process to begin talks on a deal to buy Time Warner Cable, Bloomberg reported on Friday, citing people familiar with the matter.

Mexican trade balance data for March will show if factory exports recovered from a dip in February or if weakness persisted. A separate report will show if the country’s unemployment rate is still climbing.

LIVE CHAT: The Russia and Ukraine conflict with Andreas Umland, senior research fellow at the Institute for Euro-Atlantic Cooperation Andreas Umland, Senior research fellow at Institute for Euro-Atlantic Cooperation will join us in the forum to discuss the conflict, the shaky ceasefire and his views on what Russian President Vladimir Putin might have in mind. To join the conversation, click here bit.ly/1kTxdKD

Compiled by Ayesha Sruti Ahmed in Bengaluru; Editing by Savio D'Souza

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