What to Watch in the Week Ahead and on Monday, March 16

viernes 13 de marzo de 2015 15:01 GYT
 

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Week Ahead
    
Markets will focus on U.S. Federal Reserve's statement on Wednesday, where it is expected to
change its language to remove the word "patient", suggesting a rate hike later in the spring or
summer. The recent selling in stocks could continue and interest rates should head a bit higher,
though foreign buying of safe-haven debt could keep those long-dated rates somewhat tamped down,
even if it keeps helping the dollar.
    
Oracle Corp, the world's biggest database software company, is expected to report a 2 percent
rise in third-quarter profit. The company continues to make the difficult transition to selling
its software over the cloud rather than installing it on customers' machines. Oracle may also
give valuable insight into the state of enterprise technology spending, when it reports results
on Tuesday. 
    
Nike Inc, the world's largest footwear retailer, is expected to report profit and revenue above
analysts' estimates, according to Thomson Reuters StarMine. Nike's performance is expected to be
driven by strong sales of its running and basketball shoes, particularly the Flyknit and Jordan
series, as well as continued demand for athletic apparel. However, analysts believe worries
about slowing growth in future orders, an indicator of demand, in Western Europe and emerging
markets may be exacerbated by the strong dollar. Investors will look for initial 2015 forecast
and comments about the overall industry when Nike reports third-quarter results on Thursday.
    
Package delivery company FedEx Corp is expected to post a higher third-quarter profit on
Wednesday, helped by lower fuel prices. Investors will be looking for an update on the company's
2016 forecast and for comments on whether lower fuel prices can cause a greater year-over-year
reduction in fuel surcharge revenue over the next few quarters. 
    
Photoshop maker Adobe Systems Inc is expected to post quarterly profit above estimates on
Tuesday, according to Thomson Reuters StarMine, helped by demand for its products from corporate
clients. To attract more predictable recurring revenue from its Creative Suite 6, Adobe has been
switching to Web-based subscription, which allows customers to access the latest versions of
software for a monthly payment, from traditional box licenses. Adobe is expected to benefit in
its digital media business going forward, helped by its acquisition of stock photography company
Fotolia. 
    
Chicago Fed President Charles Evans speaks on a panel with Alan Greenspan at the Brookings
Institute on Friday. Evans, a policy dove, is a voting member on the FOMC, and his views will be
interesting to parse, coming so soon after the FOMC meeting, where the Fed is expected to start
laying the groundwork for a rate hike by dropping the word "patient" from its guidance. Evans
will likely be against this, so his views will be timely. On the same day, Federal Reserve Bank
of Atlanta President Dennis Lockhart speaks on monetary policy and the economic outlook before
the Georgia Law Review Symposium.
    
Upscale jeweler Tiffany & Co's fourth-quarter profit and revenue are expected to come below
analysts' estimates, according to Thomson Reuters StarMine data. The company cut its full-year
profit forecast in January, citing weak demand during the holiday shopping season. A tax hike in
Japan, a stronger dollar and fewer tourists in the United States will likely weigh on revenue. A
Dutch court ordered Tiffany in December to pay Swatch 402 million francs in damages over a
failed joint venture to make watches. Investors will be looking out for updates on the
litigation and any forecast, when the jeweler reports results on Friday. 
    
Lennar Corp, the second-largest U.S. homebuilder by the number of homes sold, is expected to
report a drop in quarterly profit, hurt by falling housing demand in Texas, one of its largest
markets. The company had earlier warned of lower margins in 2015. Lennar has so far been able to
raise prices despite a choppy recovery in the U.S. housing market as it mainly caters to buyers
looking to upgrade to bigger homes. When the company reports first-quarter results on Thursday,
investors will look for its outlook for the year.
    
Canada's consumer prices report will be the main economic focus of the week, with inflation
expected to hold at an annualized 1 percent in February. Cheaper gasoline has weighed on
inflation, putting it at the lower end of the Bank of Canada's target range. Core inflation,
however, is forecast to come in firmer at 2.2 percent. Investors will get a handful of other
economic indicators next week, including retail sales, which are expected to have declined by
0.2 percent in January. Manufacturing sales are expected to have dropped by 1.2 percent in
January after rising strongly the prior month.

Mexico's national statistics institute will release retail sales data for January on Friday,
after the monthly indicator fell 0.8 percent in December when adjusted for seasonal swings.
    
On Monday, Bank of Japan holds two-day monetary policy meeting and will announce benchmark
interest rate decision on Tuesday.

Monday, March 16

The NAHB/Wells Fargo Housing Market index is expected to rise to 56 in March from 55 the prior
month, according to economists polled by Reuters. (1000/1500) Separately, Federal Reserve
releases industrial production, capacity utilization and manufacturing output for February.
Analysts expect industrial production to have risen marginally to 0.3 percent in the month from
0.2 percent in January. (0915/1415)
    
Brazilian central bank's IBC-Br economic activity index is expected to have risen modestly by
0.05 percent in January after dropping 0.55 percent in December. (0730/1230)

 (Compiled by Astha Rawat in Bengaluru; Editing by Kirti Pandey)