What to Watch in the Day Ahead - Thursday, Jan 21
(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) Verizon Communications is expected to report fourth-quarter revenue above Wall Street consensus. The wireless company is likely to have added more subscribers as it invests heavily in promotions. Verizon, which bought AOL in June, might also be scouting for more acquisitions, with CFO Francis Shammo saying in December the company could look at buying Yahoo. Investors will be watching out for any comments on Verizon's capex plans for 2016.
The number of Americans filing for unemployment benefits likely fell last week, showing little signs of a pick-up in layoffs despite a recent sharp slowdown in economic growth and financial markets turmoil. Weekly jobless claims likely slipped to 278,000 from 284,000 the prior week, according to a Reuters survey. The claims data covers the survey week for January nonfarm payrolls. (0830/1330) Starbucks Corp, the world's biggest coffee chain operator, is likely to report first-quarter sales slightly above analysts' average estimate. The company, which had a couple of robust quarters last year, delivered a disappointing profit forecast for the holiday quarter, citing a strong dollar. Known for starting its fiscal year with conservative estimates, the company has also locked in prices on more than 90 percent of its coffee needs for 2016. Investors would be looking for commentary on sales forecast for the second quarter and for same-store sales growth in China. Schlumberger Ltd is expected to report a steep fall in fourth-quarter profit as plunging oil prices weigh on demand for oilfield services. The world's No.1 oilfield services provider warned in October that it would incur a restructuring charge in the latest quarter due to additional job cuts. Schlumberger, whose comments are closely monitored for a glimpse into industry trends, is expected to reiterate a sluggish forecast for North America. Higher costs and a strong dollar may push American Express to report a decline in profit for the third quarter. Markets outside the United States account for about a sixth of the company's revenue. Investors will seek updates from the world's largest credit card issuer on new co-branded deals after the termination of several co-branded relationships hurt revenue last year. Fidelity Investments became the latest to drop its agreement with AmEx. Property and casualty insurer Travelers Cos Inc is expected to report a flat fourth-quarter profit, hurt by insurance pricing, which was affected most severely in the quarter. However, lower catastrophe losses and stable underwriting income are expected to have helped the results. Union Pacific, the No. 1 U.S. railroad, will post fourth-quarter results at a time when the industry is suffering from a freight recession due to falling commodity prices and North American manufacturers face a possible industrial recession. The railroads also face the possibility of another round of consolidation if Canadian Pacific's bid for Norfolk Southern results in a deal, which the company's CEO has vowed to fight against. The market will be looking for comments on the overall economy, prospects for manufacturers and any fresh comments about mergers in the industry. United Continental Holdings Inc, the second-largest U.S. airline by capacity, is scheduled to report its fourth-quarter results and provide guidance for early 2016. Investors will seek clarity on United's capacity plans and whether it sees additional turbulence in 2016 from low-cost rivals, diminished demand from oil-industry clients and traveler jitters since the November Paris attacks. Also reporting Q4 earnings will be Southwest Airlines Co. Investors will look out for comments on the airline's plans to grow internationally and in Dallas, where a judge recently ordered that the low-cost airline must share its gates with bigger rival Delta. Southwest is also expected to provide an update on its fuel hedging, which cost it hundreds of millions of dollars last year. Canadian Pacific Railway Ltd, Canada's second-largest railroad, will announce 2015 last-quarter results but focus will be on the company's pursuit of Norfolk Southern in the United States. Last month, Norfolk rejected Canadian Pacific's revised bid, reiterating that it was grossly inadequate and created substantial regulatory risks and uncertainties. Potash Corp Chief Executive Jochen Tilk and Agrium CFO Steve Douglas will make presentations at the CIBC conference in Whistler, British Columbia. Among other things, investors will be looking at any commentary on acquisitions by the fertilizer makers. Potash was rebuffed by Germany's K+S last year. Brazil payroll data is expected to show about 1.5 million Brazilians lost their jobs in 2015, in a year when the economy contracted at its steepest pace in 25 years. Meanwhile in December, Brazil's economy likely shed a net 655,000 payroll jobs. (0800/1300) DAVOS LIVECHAT-GLOBAL ECONOMIC OUTLOOK with Kaushik Basu, chief economist, World Bank Kaushik Basu is Chief Economist at the World Bank and prior to this, he was Chief Economic Adviser to the Government of India. Join us live from the World Economic Forum in Davos for a discussion on the Global Economic Outlook and the World Bank's newly released 2016 World Development Report, which makes the case that while the internet, mobile phones and other digital technologies are spreading rapidly throughout the developing world, the anticipated digital dividends of higher growth, more jobs, and better public services have fallen short of expectations. (0630/1130) To join the Global Markets Forum, click here bit.ly/1kTxdKD (Compiled by Astha Rawat in Bengaluru; Editing by Maju Samuel and Sriraj Kalluvila)
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