What to Watch in the Day Ahead - Tuesday, April 14
(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) JPMorgan Chase & Co, the biggest U.S. bank by assets, is expected to report a rise in first-quarter profit as revenue from fixed-income trading rebounds. Trading picked up early in the quarter after the Swiss National Bank shocked currency markets by scrapping a three-year old cap on the Swiss Franc without warning, causing the currency to soar against the euro. The bank has been trying to put a lid on expenses and investors will be looking for comments on what more the company will do to cut costs. Wells Fargo & Co, the largest U.S. mortgage lender, is expected to benefit from a surge in refinancing activity during the first quarter. Wells Fargo is also expected to post strong loan and deposit growth as interest rates continue to decline. The bank, which has been cashing in on the U.S. energy boom, said in January it is reviewing the possible energy loan defaults exposure. Analysts are expecting higher credit cost due to potential loan loss reserve against energy provisioning. Healthcare conglomerate Johnson & Johnson is expected to report slightly lower first-quarter profit as the strong dollar takes a toll on overseas sales. Declining sales of its hepatitis C drug somewhat offsets strong demand for new cancer medicines. Investors will be keen to see any evidence that sales of medical devices and consumer products will bounce back in 2015, after a disappointing 2014, as management suggested would be the case in January. U.S. retail sales likely bounced back sharply in March from an earlier slump, helped by strong spending at auto dealers. The 1.0 percent gain in retail sales expected to be reported by the Commerce Department would help curb concerns over recent weakness in the economy, and keep the Federal Reserve on track to hike interest rates later this year. (0830/1230) The Commerce Department will also issue data for February business inventories. (1000/1400) Separately, the Labor Department will release figures on March producer prices. They are expected to break a four-month-long downstreak with a gain of 0.2 percent, another sign that would be welcomed by the Fed. (0830/1230) Also, the National Federation of Independent Business issues Small Business Optimism Index for March. (0900/1300) Intel Corp is expected to report first-quarter results marginally below lowered Wall Street estimates, according to Thomson Reuters StarMine data. The company slashed nearly $1 billion from its first-quarter revenue forecast in March as small businesses put off upgrading their personal computers. PC shipments fell 5.2 percent in the first three months of this year, extending three years of declines, according to Gartner. Some analysts speculate that a possible uptick in demand in the June quarter could help the company issue a positive forecast. CSX Corp, the third-largest U.S. railroad, reports first-quarter results after the market closes. Analysts will be watching for signs of increases in the rates CSX charges to haul freight. Rising demand for freight has allowed the railroads to start raising prices and if the economy keeps growing, that should enable the railroads to hike rates further. Canadian media and cable company Shaw Communications Inc is expected to report a slightly lower second-quarter profit as its video subscriptions continue to fall. Demand for video subscriptions is sliding as customers switch to comparable products from phone companies, Netflix and websites such as YouTube. Investors will know to know more about the company's on-demand video streaming service Shomi which it recently launched in partnership with Rogers Communications. LIVE CHAT - FED POLICY: Searching for Goldilocks in an inflation-less economy with Cumberland Advisors Chairman David Kotok Managing the risk of waiting too long in order to avoid acting too soon is a perilous proposition for the Federal Reserve, argues Kotok, pointing to that overall terrible parallel, that 1937 comparison, where excessive austerity hit a still-struggling economy. (1000/1400) Join the Global Markets Forum to discuss the danger. Separately, Jonathan Barratt, Economist, CIO Ayers Alliance and Principal at Celsiuspro.com joins the Global Markets Forum from Sydney to talk about energy, metals, China and the global economy. (0100/0500) To join the Forum, click here bit.ly/1kTxdKD Unexpected softness in emerging market economies is likely to be highlighted by the International Monetary Fund as it releases its periodic World Economic Outlook (WEO) report with fresh growth projections for nations around the globe. The WEO is likely to reiterate IMF chief Christine Lagarde's call for action to avoid a "new reality" of subpar growth. Investors will be on the lookout for any IMF recommendations on Federal Reserve policy and for its view of the impact of the strong U.S. dollar on growth here and overseas. As for Europe, the IMF is likely to welcome signs of faster growth. Canada's Teranet-National Bank Composite House Price Index, which measures price changes for repeat sales of single-family homes, will be released for the month of March. Brazil's statistics agency IBGE releases retail sales data for February. Retail sales have disappointed as the economy slipped into recession and consumer confidence fell to record lows. (Compiled by Sourav Bose in Bengaluru; Editing by Savio D'Souza)
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