What to Watch in the Week Ahead and on Monday, Nov. 24
(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 Markets are in for a quieter week with the Thanksgiving holiday closing trading Thursday and limiting it on Friday. With markets at all-time highs and conditions thin, a bit of extra volatility might be expected, and investors, like hedge funds, might even be inclined to chase the stock market a bit higher as flows continue to come into US markets. The dollar might also see additional flows as investors extend ongoing trends toward weakening euro and yen in expectation of looser monetary policy. A raft of data next week will likely confirm the economy's solid performance in the third quarter and relatively strong start to the fourth quarter. Commerce Department data on Tuesday is expected to show third-quarter gross domestic product revised down slightly to a 3.3 percent annual pace from the 3.5 percent rate reported last month. Also on Tuesday, the Conference Board is expected to report that consumer confidence increased in November from October. The S&P/Case-Shiller house price index is likely to show prices increased 4.7 percent in September from a year ago. On Wednesday, the Commerce Department is expected to report that orders for a range of durable goods rebounded 0.3 percent in October, while orders for capital goods excluding defense and aircraft increased 0.6 percent after falling 1.6 percent in September. Also on Wednesday data from the Commerce Department is expected to show that consumer spending increased 0.3 percent in October after dropping 0.2 percent in September. The report will also likely show that income grew 0.4 percent, adding to September's 0.2 percent gain. Later on Wednesday, the Commerce Department is expected to report that new home sales rose to a 470,000 unit pace in October from a 467,000 unit rate in September. Hewlett-Packard Co is scheduled to report fourth-quarter results on Tuesday after the closing bell. The company posted an adjusted profit of $1.7 billion, or 89 cents per share, in the previous quarter. On Tuesday, Tiffany & Co, the upscale jeweler is expected to report third-quarter profit below analysts' expectations, according to StarMine. The company raised its full-year profit forecast in August following a better-than-expected rise in quarterly profit, driven by strong sales and higher prices for its high-end jewelry in the Americas, its biggest market. However, the government crackdown in China and unrest in Hong Kong are likely to have hurt results in Asia Pacific, which accounted for 23 percent of sales last year. Contraction in Japan's GDP in the third quarter is also likely to have hurt Tiffany, which got 14 percent of sales from the country last year. Deere & Co releases fourth-quarter results before the bell on Wednesday. Declining grain and oilseed prices have hurt sales of tractors, harvesters and other agricultural machinery and forced the world's largest maker of farm equipment to cut its 2014 forecast. The company will provide investors with a first glimpse of its expectations for 2015. Analysts say the industry's outlook has deteriorated since Deere last provided an update. ReneSola Ltd, the Chinese solar panel maker is expected to report a profit in the third quarter on Wednesday, compared with a year-ago loss, helped by higher panel shipments. ReneSola, which uses an extensive network of contract manufacturers across the globe, has been able to continue selling panels into the United States, despite duties on imports from China.
Digital video recorder maker TiVo Inc is expected to report third-quarter revenue marginally below estimates on Tuesday, according to Star Mine. Cable TV operator growth has decelerated as market penetration rates have gone above 60 percent, according to analysts. The company had been dependent on its cable TV partners such as Virgin Media in UK, ONO in Spain and Com Hem AB in Sweden for revenue in the previous quarter. TiVo has been trying to partner with more cable TV operators to grow its business. World's biggest panel supplier Yingli Green Energy Holding Co is expected to report a smaller third-quarter loss on Tuesday, helped by strong demand from China and Japan. The company, heavily reliant on the low-price China market, has stayed in the red, even as smaller rivals have turned profitable. Investors will be looking for the company's expansion into newer markets will help the company return to the black. On Tuesday, data storage equipment maker Nimble Storage Inc is expected to post a loss smaller than analysts' average expectation in the third quarter, according to StarMine data. The company, which made its IPO debut in December, is expected to benefit from higher demand for its flash storage products. Nimble is yet to turn a profit. Canada will get a look at the health of its economy next week, with the gross domestic product report expected to show the economy grew at a 2.1 percent annualized rate in the third quarter. Although that is an improvement from the start of the year, that will still mark a step down from the second quarter's 3.1 percent pace. Also on tap for next week, retail sales for September are forecast to rise 0.5 percent, bouncing back from a disappointing drop the month before. Brazil's government statistics agency IBGE releases third-quarter GDP data on Friday. Brazil's economy probably recovered slightly in the third quarter after a mild recession in the first half of the year, in a relief for President Dilma Rousseff and her newly announced economic team. Still, economists warn the rebound may be short-lived. Separately, Argentina's government is due to release October trade balance data on Tuesday and industrial production data for October on Friday. On Tuesday, current account data will show whether investors continued to pile into Mexico's stocks and bonds and cut investment in factories and businesses in the third quarter. On Wednesday, trade balance data will signal whether factory exports and non-oil consumer imports continued to slip in October, after falling in September. Fiscal balance data for October will be released on Friday. On Tuesday, Bank of Japan Governor Haruhiko Kuroda will speak to business leaders in Nagoya, central Japan, home to auto giant Toyota and many of its parts suppliers which likely benefitted from the weak yen resulting from the BOJ's massive stimulus programme. Some business executives, however, have recently talked about the demerits about the weak yen, such as rising import costs, so focus on whether Kuroda faces similar complaints and how he could respond. Also looking for fresh comments from Kuroda on the government's decision to postpone a second sales tax hike. MONDAY, NOVEMBER 24 Workday Inc is expected to post a loss smaller than the average analyst estimate for the third quarter. The company, which makes cloud-based software to manage employee performance, payroll and expenses, had been benefiting from strong growth in subscriptions as more companies opt for Web-based software which are easier to update, maintain and customize. Security software maker Palo Alto Networks Inc's first-quarter revenue expected to be slightly above the average analyst estimate, helped by higher demand for its products as more businesses look to secure their data and networks from hackers. Palo Alto forecast in September Q1 profit and revenue above Wall Street estimates. Nuance Communications Inc, which makes software that runs the Siri feature on Apple iPhones, is expected to report quarterly profit and revenue below analysts' estimates, according to Starmine. Nuance is transitioning to a subscription-based model which brings in less money upfront as payment is spread over the entire period of use, unlike traditional packaged software, but typically ensures more predictable recurring revenue. Investors will be looking for management commentary on 2015 outlook. Solar panel maker Trina Solar Ltd is expected to report a higher quarterly profit on robust demand from China and Japan. The company is expected to benefit from its expansion into emerging solar markets such as South America, Middle East and Africa in the third quarter. Investors will look for details about the company's plans to set up overseas plants to sidestep U.S. duties. Cameco Corp holds a webcast for investors to delve into production issues in Canada and Kazakhstan, along with observations about global marketing conditions. A modest rebound in uranium prices has drawn renewed attention to the sector. Of interest are Cameco's possible interest in M&A and any revised outlooks for sales and production. Brazil's consumer confidence index measured by think tank Fundacao Getulio Vargas (FGV) is scheduled to release. Also, Brazil's central bank releases its report on the balance of payments. Data will reveal whether a spike in Mexico's annual inflation continued in early November after reaching a nine-month high in October. The jobless rate for October will be released the same day, after two months of declines in the seasonally adjusted figure. (Compiled by Sourav Bose in Bangalore; Edited by Don Sebastian)
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