Truth or Dare this Week
There are three economic reports of significance scheduled for the American newswire Monday, and about a billion earnings reports.
The Personal Income & Outlays Report is due at 8:30 AM ET. Economists expect consumer spending increased 0.1% month-to-month in March, versus February’s 0.7% rise. This data is critical, given our consumer driven economy, with the service sector dominating it. Investors will certainly also note the PCE Price Index for its inflation measurement. For March, economists see the Core PCE, which excludes volatile food and energy prices, rising 0.1% after increasing at the same pace in February. The Core PCE Price Index is also of high interest, given its status as the Federal Reserve’s favored inflation gauge. The same report offers the latest information on personal income. Economists see incomes up 0.4% month-to-month, versus February’s 1.1% increase.
Pending Home Sales data, an important early indicator for real estate, is due at 10:00 AM ET. Economists expect the representative index measuring contracts signed in the existing home market (not new homes) rose 0.7% in March, against the 1.0% decline seen in February.
The Dallas Federal Reserve Bank reports its Texas Manufacturing Outlook Survey Monday morning. This April measure is expected by economists to deteriorate, though continue to reflect economic expansion, with the economists’ consensus forecast set at 5.0, versus 7.4 in March.
Markets are closed in China and Japan; for China it’s the start of a three-day holiday.
In corporate news, American Express (NYSE: AXP) has its annual meeting scheduled. Patriot Coal is in bankruptcy court in an attempt to impose wage cuts upon its union workers.
The earnings schedule highlights news from Eaton (NYSE: ETN), Express Scripts (Nasdaq: ESRX), Jacobs Engineering (NYSE: JEC), Loews (NYSE: L), Newmont Mining (NYSE: NEM), Plum Creek Timber (NYSE: PCL), Roper Industries (NYSE: ROP), The Hartford Financial Services Group (NYSE: HIG) and many others.
Several economic reports are on tap for Tuesday. The first quarter’s Employment Cost Index is due for report at 8:30 AM ET. Economists see the index higher by 0.5%, after rising by the same amount in the fourth quarter of 2012.
The Case Shiller Home Price Index is due around 9:00 AM ET for the month of February. Economists see the 20-City seasonally adjusted index rising 1.0% month-to-month, same as it grew the month before.
The Chicago Purchasing Managers Index is due for report at 9:45 AM. This measure of Midwestern manufacturing is expected by economists to show the PMI for April held steady at 52.4, but I have my doubts.
At 10:00 AM, the Conference Board reports again on its Consumer Confidence Index. Last month, this index and its peer measure at the University of Michigan showed consumer confidence fell off a cliff. This latest measurement, reflecting April sentiment, is expected by economists to improve to a mark of 62.0, up from 59.7.
The weekly retail same-store sales data also arrives on Tuesday, this time for the week ended April 27. Last week, the International Council of Shopping Centers (ICSC) showed a week-to-week sales increase of 0.8%, versus the 1.1% decrease the week before. On a year-to-year basis, sales were higher by 1.9%, versus the 2.0% increase in the prior week. The data may have been affected by the events in Boston.
State Street’s (NYST: STT) Investor Confidence Index is due for report at 10:00 AM ET. Last month, the data showed institutional investors soured globally (index down 3.4 points). U.S. investors mostly drove the move, as the North American Index dropped 4.2 points.
At 3:00 PM, catch the Farm Report covering agricultural goods prices.
Secretary of State Kerry will present to Congress a list of countries designated as state sponsors of terror.
In corporate news, Needham’s healthcare conference offers presentations by Amicus Therapeutics (Nasdaq: FOLD) and Durata Therapeutics (Nasdaq: DRTX). Barclay’s (NYSE: BCS) Retail & Consumer Discretionary Conference highlights presentations by Macy’s (NYSE: M) and Coach (NYSE: COH). Look for earnings news from Aetna (NYSE: AET), Avon Products (NYSE: AVP), McGraw-Hill (NYSE: MHP), Franklin Resources (NYSE: BEN), NextEra Energy (NYSE: NEE), Pitney Bowes (NYSE: PBI), AGL Resources (NYSE: GAS), Avalonbay Communities (NYSE: AVB), Cummins (NYSE: CMI), Ecolab (NYSE: ECL), Edison Int’l (NYSE: EIX), Ensco (NYSE: ESV), Fidelity National (NYSE: FIS), Fiserv (Nasdaq: FISV), FMC (NYSE: FMC), Genworth (NYSE: GNW), Harris (NYSE: HRS), Hudson City Bancorp (Nasdaq: HCBK), Invesco (NYSE: IVZ), Legg Mason (NYSE: LM), Marathon Petroleum (NYSE: MPC), MeadWestVaco (NYSE: MWV), NiSource (NYSE: NI), NYSE Euronext (NYSE: NYX), ONEOK (NYSE: OKE), Pfizer (NYSE: PFE), Public Service Enterprise (NYSE: PEG), QEP Resources (NYSE: QEP), Starwood Hotels & Resorts (NYSE: HOT), TECO Energy (NYSE: TE), Tenet Healthcare (NYSE: THC), United States Steel (NYSE: X), Valero Energy (NYSE: VLO), Western Union (NYSE: WU), Wisconsin Energy (NYSE: WEC), Xylem (NYSE: XYL) and more.
It’s Fed day, with the FOMC Monetary Policy Statement due for report at 2:00 PM ET. Economists and yours truly expect no change in monetary policy. Investors will turn their attention to any change in wording that might indicate the Fed’s forward path and timeline. The quarterly Treasury Refunding Announcement is due today as well. The Treasury Department will announce its funding needs and plans for the next several months. An SEC advisory panel will hold a meeting to discuss topics about small and emerging companies.
ADP’s Private Employment Report for April is expected to show private nonfarm payrolls increased by 155K, versus last month’s 158K estimate. Economists expect private nonfarm payrolls, as reported by the government on Friday, to show an increase of 175K jobs, versus the 95K reported last month.
We have two manufacturing indicators due today, with the Markit Economics PMI Manufacturing Index and the ISM Manufacturing Index scheduled. The PMI Manufacturing Index is first up at 8:58 AM ET. Economists expect the index to stay at 52.0 in April, after its Flash reading at that mark, which was down from 54.6 at the end of March. The Institute for Supply Management (ISM) issues its Manufacturing Report on Business for the month of April at 10:00 AM. Economists see this index slipping to a mark of 51.0, from 51.3 the month before. FYI – that reading marked a deep drop from February’s reading of 54.2.
Monthly Construction Spending data is due for report at 10:00 AM ET. While construction spending has been growing regularly for some time now, over the last three months, the pace seems to be showing a slowing of it. Economists expect an increase of 0.6% in March, after February’s increase of 1.2%.
The latest mortgage activity data arrives from the Mortgage Bankers Association Wednesday before the market open. Last week’s report covering the period ending April 19 showed mortgage applications increased by 0.2%, after rising 4.8% the week before. Applications tied to the purchases of homes increased by 0.3% on a seasonally adjusted basis to its highest level since May of 2010. The Refinance Index increased by 0.3%, after rising 5.0% the week before. Effective interest rate changes were mixed.
Look for the EIA’s regular Petroleum Status Report at 10:30 AM ET. Last week’s report covering the week ending April 19 showed crude oil inventory increased by 0.9 million barrels, and remained well above the upper limit of the average range for this time of year. Total motor gasoline inventory decreased by 3.9 million barrels and remained in the upper half of the average range.
May Day means markets across the world will be closed, including in Hong Kong, Brazil, Germany and Russia, but not in the U.S.
Automakers will report Monthly Motor Vehicle Sales for the month of April today. Economists expect the annual pace of domestic vehicle sales ran at 12.0 million in April, down from 12.1 million in March. Total vehicle sales are expected to have matched last month’s 15.3 million pace.
The Barclay’s (NYSE: BCS) Retail and Consumer Discretionary Conference offers presentations by Dunkin’ Brands (Nasdaq: DNKN) and Hasbro (NYSE: HAS) Wednesday. BB&T (NYSE: BBT) and DTE Energy (NYSE: DTE) have investor meetings scheduled today. Kodak expects a bankruptcy court to allow it to sell off some assets.
The EPS schedule highlights reports from Facebook (NYSE: FB), ADT Corp. (NYSE: ADT), Allstate (NYSE: ALL), American Tower (NYSE: AMT), Archer Daniels Midland (NYSE: ADM), CBS Corp. (NYSE: CBS), Chesapeake Energy (NYSE: CHK), Comcast (Nasdaq: CMCSA) (NYSE: CCV), Coventry Health (NYSE: CVH), Delphi Automotive (Nasdaq: DLPH), Devon Energy (NYSE: DVN), Exelon (NYSE: EXC), Garmin (Nasdaq: GRMN), Hospira (NYSE: HSP), Humana (NYSE: HUM), Integrys Energy (NYSE: TEG), Intercontintental Exchange (NYSE: ICE), Iron Mountain (NYSE: IRM), JDS Uniphase (Nasdaq: JDSU), Lincoln National (NYSE: LNC), Marriott International (NYSE: MAR), MasterCard (NYSE: MA), Merck (NYSE: MRK), Metlife (NYSE: MET), Murphy Oil (NYSE: MUR), Phillips 66 (NYSE: PSX), Pioneer Natural Resources (NYSE: PXD), Prudential (NYSE: PRU), Rowan (NYSE: RDC), Seagate (NYSE: STX), Sealed Air (NYSE: SEE), Tesoro (NYSE: TSO), The Clorox (NYSE: CLX), Time Warner (NYSE: TWX), Unum (NYSE: UNM), Viacom (Nasdaq: VIAB), Visa (NYSE: V) and Yelp (Nasdaq: YELP).
Several economic reports litter the day’s schedule today, including a few more labor market data points. Important information emanates from overseas Thursday, with the critical European Central Bank monetary policy decision on tap. Many suspect the ECB could cut rates given recent economic data. Also, the European Commission (EC) is due to provide its spring forecasts for EU states.
The Challenger Job-Cut Report reaches the wire in the premarket Thursday. The measure of announced corporate layoffs showed 49,255 of them in March and 55,356 of them in February.
Weekly Initial Jobless Claims is due for report at 8:30. Last week’s report covering the period ending April 20 showed weekly claims decreased by 16K, to 339K. Economists see claims rising to 345K this week. The weekly jobless claims four-week moving average declined by 4,500 last week, falling to 357,500.
Nonfarm Productivity and Costs data will be reported for the first quarter at 8:30 AM ET Thursday. Economists see productivity improved by 1.3% in the quarter, after it contracted in the fourth quarter by 1.9%. Unit Labor Costs are expected to increase by 0.1% after increasing 4.6% in Q4.
The International Trade Report for the month of March is expected to show the trade deficit contracted to $42.4 billion, from $43.0 billion the month before. In February, exports rose 0.8% while imports were relatively unchanged. Both export and import activity has dulled since recovering post the crisis and recession.
After shooting up 4.8 points the week before, the Bloomberg Consumer Comfort Index, a weekly measure of the consumer mood, eased 0.7 points last week, reaching a mark of -29.9. I expect the index to revisit lower levels before long. Consumers are not generally in a good mood today, as was evidenced by the recent drops seen in the Conference Board and University of Michigan monthly measures.
The EIA’s Natural Gas Report is due Thursday at 10:30 AM. Last week’s report covering the period ending April 19 showed working gas in storage increased by 30 Bcf. Stocks were 807 Bcf less than last year at this time and 94 Bcf below the five-year average for this time of year.
Look for investor meetings at Dish Network (Nasdaq: DISH), DuPont (NYSE: DD) and Strayer Education (Nasdaq: STRA). BioAmber, an alternative energy company, has its IPO planned and QIWI will do the same. The EPS slate highlights presentations by LinkedIn (Nasdaq: LNKD), American International Group (NYSE: AIG), Cardinal Health (NYSE: CAH), International Paper (NYSE: IP), Marsh & McLennan (NYSE: MMC), Becton Dickinson (NYSE: BDX), Cigna (NYSE: CI), Actavis (NYSE: ACT), Airgas (NYSE: ARG), Ameren (NYSE: AEE), Beam (Nasdaq: BEAM), CenterPoint Energy (NYSE: CNP), CME Group (NYSE: CME), Denbury Resources (NYSE: DNR), Dun & Bradstreet (NYSE: DNB), Estee Lauder (NYSE: EL), Fluor (NYSE: FLR), Gilead Sciences (Nasdaq: GILD), Harman Int’l (NYSE: HAR), Kellogg (NYSE: K), Kraft Foods (Nasdaq: KRFT), Microchip Technology (Nasdaq: MCHP), Mylan (NYSE: MYL), Northeast Utilities (NYSE: NU), PG&E (NYSE: PCG), PPL Corp. (NYSE: PPL), Quanta Services (NYSE: PWR), Scripps Networks (NYSE: SNI), Sempra Energy (NYSE: SRE), Southwestern Energy (NYSE: SWN), Teradata (NYSE: TDC), Vulcan Materials (NYSE: VMC), WPX Energy (NYSE: WPX), Xcel Energy (NYSE: XEL), XL Group (NYSE: XL), ZAGG (Nasdaq: ZAGG) and more.
This day will be all about the monthly Employment Situation Report for April. Nonfarm Payrolls are expected to be up by 153K this month, after only increasing by 88K in March. Private Nonfarm Payrolls are seen higher by 175K this month, versus the 95K increase last month. The Unemployment Rate is expected to stay at 7.6%. Average Hourly Earnings is expected higher by 0.2%, after being unchanged in March. The Average Workweek is expected to hold at 34.6 hours.
Factory Orders are due for report at 10:00 AM. The data for March is expected to show factor orders declined by 2.8%, after marking a 3.0% increase in February. That would be consistent with the trend seen across manufacturing data points recently.
After reporting its manufacturing data a few days prior, ISM will publish its Nonmanufacturing Report on Business today at 10:00 AM. ISM’s service segment index is expected to fall to 54.0 in April, from 54.4 in March.
The Bank of Japan (BOJ) publishes the minutes of its blockbuster April meeting today.
Look for Fed speak from Richmond Fed President Lacker and Fed Governor Tarullo today.
The corporate wire has the earnings of ADP (NYSE: ADP), Duke Energy (NYSE: DUK), Moody’s (NYSE: MCO), Newell Rubbermaid (NYSE: NWL), Pepco Holdings (NYSE: POM), Pinnacle West Capital (NYSE: PNW), Spectra Energy (NYSE: SE), The Washington Post (NYSE: WPO) and a few more.
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