WEEK AHEAD
Markets go into next week still shaken from more than two weeks of volatility and an uncertain
outcome for the Federal Reserve. Which is to say, the volatility is going to continue in the
coming week when the data slate is light, both in the United States and overseas. Stocks are
keyed in on the 1867 level on the S&P 500, seen as a point of technical support that, if broken,
could worsen the outlook for the market, and investors will keep watching measures of volatility
to see if more selling could erupt.
Investors will look for U.S. Labor Department's job openings and labor turnover data on
Wednesday. Job openings, a measure of labor demand, is likely to have risen to 5.301 million in
July, compared to 5.249 million in the prior month. On Friday, the Labor Department will also
release producer price index (PPI) for final demand for August. Economists expect PPI to have
declined 0.1 percent, after it had risen 0.2 percent in July. Another report is expected to show
import prices further dropped 1.6 percent in August. It had declined 0.9 percent in the previous
month. Meanwhile, economists polled by Reuters expect the University of Michigan's consumer
sentiment index to have decreased in September to 91.4 from 91.9 earlier. Wholesale inventories
data is scheduled to be released on Thursday, with an increase of 0.3 percent in July.
Apple Inc (NASDAQ:AAPL) is expected to announce new iPhones and an Apple TV box at an event at the Bill Graham
Civic Auditorium in San Francisco, California on Wednesday. Specifically, it is expected to
announce the iPhone 6S and iPhone 6S Plus, the same size as the 6 and 6 Plus but with new
software and some internal hardware improvements. It is also expected to announce an upgrade to
the Apple TV, but not a new bundled cable TV package, which most experts say won't launch until
next year. It may also announce an updated iPad mini and a new iPad Pro aimed at the enterprise
market.
On Friday, Kroger (NYSE:KR) Co, the biggest U.S. supermarket operator, is expected to report
second-quarter revenue slightly below analysts' average estimate.
On Wednesday, security software maker Palo Alto Networks Inc is expected to report
fourth-quarter earnings slightly above analysts' average estimate. The seller of firewalls to
prevent data breaches and block malware and viruses has been benefiting from strong demand from
corporate clients looking to guard their data and networks from increasingly sophisticated cyber
attacks.
Canadian yogawear retailer Lululemon Athletica Inc posts second-quarter results on Thursday. The
company is expected to report a rise in revenue, driven mainly by increasing online sales and
the popularity of its men's clothing range, which offsets the pressure from a fall in the
Canadian dollar. However, the company's margins are expected to be under pressure as its stores
grow larger in size and the company expands in Europe and Asia.
The European Commission has set a Friday deadline to decide on the approval for General Electric (NYSE:GE)
Co's purchase of the of the power equipment business of France's Alstom (PARIS:ALSO). The roughly $13.5
billion deal, the biggest acquisition ever for GE, will bring together two of the world's
largest manufacturers of power plant hardware. The decision will allow the U.S. industrial
conglomerate to finally carry out a major cost-cutting program 16 months after first announcing
the deal.
Barnes & Noble (NYSE:BKS) Inc posts first-quarter results on Wednesday. The bookstore chain is expected to
report profit above analysts' average estimate. Barnes & Noble is improving store merchandise,
featuring popular books and movies and integrating its online and retail platforms to reverse
falling sales. Some of the company's efforts such as overhauling its toys and gifts division
have been paying off. The company last month spun off its profitable college books business to
focus more on its retail bookstores and hired a new CEO for the bookstore arm. Investors will
look for updates to the forecast, information on trends and store traffic, and comments from the
new CEO.
Cloud storage provider Box Inc is scheduled to post second-quarter results after the markets
close on Wednesday. Last quarter, Box raised its full-year revenue forecast as more customers
signed up for its content-sharing platform. The company's main competitors include privately
held Dropbox, Microsoft (NASDAQ:MSFT)'s OneDrive, Citrix Systems (NASDAQ:CTXS)'s ShareFile and Google (NASDAQ:GOOGL)'s Drive. Investors and
analysts will be looking for how many deals Box managed to close in the quarter, and how its
plan to be cash flow breakeven by the end of the next fiscal year is panning out.
On Wednesday, the Bank of Canada is expected to hold interest rates steady at 0.5 percent as it
waits to see whether the economic pick-up expected in the second half of the year is unfolding.
The central bank has cut rates twice this year in an effort to boost an economy hit by the
plunge in oil prices. Despite confirmation the economy was in a mild recession in the first half
of 2015, signs of growth at the end of the second quarter, as well as recent strong export
figures, are expected to stay the bank's hand.
Next week, Latin American events will show the numbers from Brazil and Mexico's inflation on
Thursday and Wednesday respectively, to Mexico's industrial output data on Friday. Argentina's
Consumer Price Index will be on the radar on Friday.
ON TUESDAY, SEPTEMBER 8
The National Federation of Independent Business issues its Small Business Optimism Index for
August. U.S. small business confidence had rebounded in July as owners anticipated solid sales
and inventory growth. (0600/1000) The U.S. Federal Reserve is scheduled to report the
outstanding credit extended to American consumers in July. Total consumer credit is likely to
come in at $18.8 billion in July, down from $20.74 billion in the prior month. (1500/1900)
Federal Reserve Bank of Minneapolis President Narayana Kocherlakota speaks on "Outlook for U.S.
Monetary Policy" before the Advanced Workshop for Central Bankers, in Evanston, Illinois.
(1715/2115)
Digital video recorder TiVo (NASDAQ:TIVO) Inc is expected to report second-quarter revenue and profit below
estimates. The company said that it expected new additions of subscribers to decline, compared
to last year. TiVo's set-top boxes have been in demand from cable users as they also allow
access to online video services such as Netflix (NASDAQ:NFLX), Hulu and YouTube, but in light of the recent
cable sector rout investors will be looking to see if TiVo's subscribers will be impacted as
well. Many analysts have said that the company should explore going private or putting itself up
on the block.
LIVECHAT: OUTLOOK FOR RATES with Wilmington Trust's Luke Tilley
After a dramatic couple of weeks in markets, a September move on U.S. rates looks anything but
certain. Join Global Markets Forum for a chat about markets and the Fed with former Philly Fed
official Luke Tilley. (1000/1400)
Chile's statistics agency issues inflation data for August, which is likely to remain steady at
0.40 percent. (0700/1100)
(All analysts' estimates are according to Thomson Reuters StarMine, unless mentioned otherwise)
(U.S. markets are closed on Monday, Sept. 7, for Labor Day)