What to Watch in the Day Ahead - Wednesday, Nov 4
(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) Social media giant Facebook Inc said last quarter it would increase investments in areas such as Messenger, WhatsApp and Oculus to boost advertising revenue from mobile and drive future growth. Despite an increase in spending, Facebook is expected to report third-quarter profit above analysts' average estimate, according to Thomson Reuters StarMine. Allergan Plc, which has been approached by Pfizer Inc in "friendly" talks to become the world's largest drugmaker, is expected to post third-quarter profit, which may edge past market estimates. Investors will be keen on knowing if the company is on track to meet its $8 billion revenue target for the second half of the year. Chipmaker Qualcomm Inc is expected to report a fourth-quarter profit above analysts' average estimate, according to Thomson Reuters StarMine. Investors will be looking for signs of a recovery in the intensely competitive chipset business as well as details on cost control. Investors will be focusing on ADP's report on private employment. Economists are expecting a gain of 180,000 jobs in October, according to a Reuters' poll. (0815/1315) The U.S. trade deficit likely narrowed sharply in September as exports increased, a tentative sign that the dollar's negative impact on trade was starting to ease. According to a survey of economists, the trade deficit probably narrowed to $41.1 billion from $48.3 billion in August. (0830/1330) Meanwhile, the Institute for Supply Management non-manufacturing index for October is expected to have edged lower to 56.5 in October from 56.9 in September, showing a slight declaration in the pace of U.S. service sector's growth. (1000/1500) Federal Reserve Chair Janet Yellen is scheduled to testify before the House Financial Services Committee on Federal Reserve actions and plans for bank regulation and supervision. (1000/1500) Federal Reserve Board Governor Lael Brainard participates in "Financial Stability" panel before the European Central Bank Forum on Banking Supervision. (0530/1030) Meanwhile, the New York Fed President William Dudley will participate in a briefing, "Looking Beyond the Macro Economy," in New York with staff researchers to discuss what broader policy decisions mean for individuals, households and regions. (1000/1500) Also, the Federal Reserve Bank of Philadelphia President, Patrick Harker, speaks on "Why Pay for Success: The Need for New Sources of Social Innovation Capital" before the "Capital for Communities: Pay for Success Financing" event. (0845/1345) Media company Twenty-First Century Fox Inc is expected to post first-quarter revenue below Wall Street estimates, according to Thomson Reuters StarMine. Fox has significant operations abroad and has been hit by a strong dollar. Adding to its woes, the shrinking pay TV industry has driven away subscribers from its cable network business, forcing the company to lower its full-year earnings forecast in August. Time Warner Inc, the second largest cable company in U.S., is expected to report third-quarter revenue marginally above analysts' average estimates, according to Thomson Reuters StarMine. Time Warner has been reorganizing its businesses to grab a larger share of the video-streaming market as consumers increasingly take to watching television shows online. In its fourth-quarter earnings report, the Wall Street is expecting continued cooling of Whole Foods Market Inc's quarterly same-store sales as it battles competition from mainstream retailers as well as its own stores. The organic and natural food chain has also been hurt by negative publicity surrounding a New York City overcharging scandal. Cognizant Technology Solutions Corp is expected to report third-quarter results slightly above analysts' average estimate, according to Thomson Reuters StarMine. Cognizant has been benefiting from its fast-growing healthcare business, which has led the company's growth for the past quarters. King Digital Entertainment Plc, the creator of "Candy Crush Saga", is expected to beat market expectations for third-quarter revenue, according to Thomson Reuters StarMine. The company, which makes games for social media websites and mobile devices, has struggled to boost bookings in the first half of the year. King Digital said videogame maker Activision Blizzard Inc will acquire the company for $5.9 billion, a 16 percent premium to King's close on Monday. Regeneron Pharmaceuticals Inc is expected to report third-quarter earnings above analysts' average estimates, according to Thomson Reuters StarMine, driven by higher sales of the company's blockbuster eye drug, Eylea. Health insurer WellCare Health Plans Inc is expected to report third-quarter earnings largely in line with analyst expectations, according to Thomson Reuters StarMine, helped largely by Medicare prescription drug plans and Medicaid enrollments. Michael Kors Holdings Ltd, the luxury handbag and accessories maker, is expected to report second-quarter sales above analysts' average estimates, according to Thomson Reuters StarMine. Kors has been plagued by a lull in the handbag market and is offering heavy discounts to attract customers. Cyber security company FireEye Inc is expected to report third-quarter results slightly below analysts' average estimate, according to Thomson Reuters StarMine. Despite rising demand for its latest security offerings, analysts cite growing competition for firewall add-on products hurting FireEye. Motorola Solutions Inc, which makes walkie-talkies and radio systems, is expected to report third-quarter profit above average analysts' expectations, according to Thomson Reuters StarMine. Investors will be looking for potential M&A opportunities after Silver Lake's $1 billion investment in the company. Nitrogen producer CF Industries' third-quarter results are expected to be hampered by sliding nitrogen prices. Investors will be interested in an update on the company's U.S. expansion and its pending acquisition of rival OCI N.V. The hamburger chain operator Wendy's Co is expected to report third-quarter profit and revenue above analysts' estimates, according to Thomson Reuters Starmine. Wendy's is likely to benefit from the renovations of its restaurants in the third quarter, which in turn may boost same-store sales. Investors will be looking for any comments on forecasts for the remainder of the year, especially given that beef prices are on the rise again. Web-hosting company GoDaddy Inc is expected to report third-quarter profit below average analysts' estimates, according to Thomson Reuters StarMine. GoDaddy, which manages about 60 million internet domains, or about a fifth of the world's total, has been investing heavily to expand into new markets. Chesapeake Energy Corp, the second largest U.S. producer of natural gas, is expected to report a third-quarter loss, compared with a profit a year earlier, hurt by the drop in crude oil and low natural gas prices. The rig operator Transocean Ltd is expected to report a lower third-quarter profit as weak oil prices weigh on drilling activity. Investors will look for comments on new contracts and updates on existing rig orders. The hardwood flooring retailer Lumber Liquidators Holdings Inc is likely to report a smaller-than-expected third-quarter loss, according to Thomson Reuters StarMine. The company has suffered sales and executive losses and is facing multiple investigations on allegations that its laminated products sourced from China contained excessive levels of a known carcinogen. Canada's trade deficit is expected to narrow in September to C$1.90 billion and investors will be watching to see if exports can bounce back from August's decline. Unless there are major revisions to the previous months' figures, analysts are expecting trade activity to have contributed significantly to overall economic growth in the third quarter. (0830/1330) Brazilian industrial output probably plunged in September as steelmakers, car factories and other manufacturers continued to adjust for a severe and probably long recession. Brazil's industrial production likely fell 11.4 percent from September 2014, the steepest drop since April 2009, according to a recent poll. Output probably fell a seasonally adjusted 1.5 percent from August, worse than a contraction of 1.2 percent in the previous month. LIVECHAT - Macroeconomics with Elwin de Groot, senior market economist, Rabobank With markets fully geared up for another bout of policy loosening from the European Central Bank and few other countries showing signs of ending their easing cycles, the main question for markets is will the Fed really go ahead and pull the rate hike trigger. We talk to Elwin de Groot, senior market economist at Rabobank at 0500/1000, about how much room to maneuver do the central banks really have. To join the Global Markets Forum, click here bit.ly/1kTxdKD (Compiled By Nayyar Rasheed in Bengaluru; Editing by Anil D'Silva)
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