What to Watch in the Day Ahead - Thursday, Aug. 28

Wed Aug 27, 2014 2:52pm EDT

(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) The U.S. Commerce Department is due to release a first revision of second-quarter gross domestic product figures. Previous figures showed the U.S. economy rebounding strongly in the second quarter, after a dismal first three months of the year. But the Commerce Department is likely to slash its projections down to 3.9 percent in its first revision of second-quarter estimates, down from a previously reported 4 percent growth (0830/1230). Also expected is the National Association of Realtors' pending home sales index, which is likely to show that contracts to buy previously owned homes rose in July (0830/1230). Weekly jobless claims data from the Labor Department is also on the radar (0830/1230). Discount retailer Dollar General, in the midst of a bidding war for smaller rival Family Dollar, had said in June that it expects gross margins to improve in the second half of the year as it focuses on more profitable products such as accessories and stationery items. The company has been struggling to shore up margins after it slashed prices to keep its lower-income shopper base from being lured by retail giants Wal-Mart Stores and Target. When the company releases second-quarter results, analysts and investors will be looking out for comments on the its next move following Family Dollar's rejection of its $8.95 billion bid, in favor of Dollar Tree's smaller offer, citing antitrust concerns. Avago Technologies is likely to report better-than-expected third-quarter revenue, according to Thomson Reuters StarMine data, helped by higher demand for its radio frequency chips used in smartphones. Analysts expect the company to benefit from the deployment of Long Term Evolution. The company's wireless business is likely to be boosted by the launch of Apple's next iPhone in September. State-run Chinese offshore oil and gas producer CNOOC is expected to post a sharp fall in its first-half earnings as costs surged and production growth continued to sputter. CNOOC'S management will hold a media briefing at 1800 Hong Kong time. Investors will look for comments on cost cutting, production targets and anything related to the South China Sea. Oil and gas producer PetroChina Co Ltd, which also owns refineries, is expected to post a slight increase in second-quarter profit, thanks in part to higher oil and gas prices and an improvement in refining margins. Investors expect the management to provide updates on the progress of the company's pipeline assets divestment and overseas transactions. Toronto-Dominion Bank and CIBC are scheduled to report their third-quarter results. Canada's second- and fifth-largest lenders are both expected to report higher revenues and strong profits on the back of growing loan volumes and buoyant capital markets. But investors will watch for executive comments on slowing loan growth, the sustainability of profits from the banks' investment banking arms and on a domestic housing market, which many fear is due for a downturn. Abercrombie & Fitch is likely to report a second-quarter profit above analysts' expectations, according to StarMine. Analysts expect demand and gross margin to have remained weak in the quarter as the company clears excess inventories through discounting and tries to woo back customers by expanding its merchandise. Investors will watch for commentary on the second half of the year, when the company hikes investment in e-commerce and implements a cost-cutting plan that includes store closures to boost results. The Alpbach economic conference in Vienna continues with speakers for the day including European Commissioner for Employment, Social Affairs and Inclusion Laszlo Andor, Polish National Bank Governor Marek Belka and Bank of Finland Governor Erkki Liikanen. Data on Canada's current account will be watched, with economists forecasting that the deficit will continue to narrow in the second quarter. The report will be parsed for what it shows about the performance of the country's export sector, which the central bank is hoping will become a bigger driver of growth (0830/1230). Tayyip Erdogan will cement his position as modern Turkey's most powerful leader when he is sworn in as head of state, taking him a step closer to the presidential system he covets, but heralding what opponents fear will be an increasingly authoritarian rule. Erdogan swears his oath in parliament at 1100 GMT followed by a ceremony in the early evening at the presidential palace, expected to be attended by representatives from around 75 countries. (Compiled by Ayesha Sruti Ahmed in Bangalore; Editing by Simon Jennings)

A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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