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Federal Reserve Chair Janet Yellen is the main focus this week for U.S. central bank watchers,
airing her latest views on the state of the economy and small businesses, a traditional driver
of job creation, when she speaks in Washington on Thursday. The centrist chief of the Atlanta
Fed, Dennis Lockhart, and the hard-to-classify James Bullard, who heads the St. Louis Fed, are
also among top Fed officials taking to the podium this week to talk about the Fed's next steps
as it slowly retreats from its unprecedented stimulus amid a firming - but still
far-from-robust- job market.
Retail sales, manufacturing and housing data next week will show strength in the economy early
in the second quarter. The Commerce Department is expected to report on Tuesday that retail
sales increased 0.4 percent in April and a gauge of consumer spending gained 0.6 percent.
Inflation reports from the Labor Department are expected to show little price pressure in the
economy. Consumer prices are seen increasing 0.2 percent in April after rising by the same
margin in March. The producer price index for final demand is seen increasing 0.2 percent,
slowing from a rise of 0.5 percent in March. On Thursday, the Federal Reserve is expected to
report that factory output increased 0.3 percent in April. A decline in demand for utilities as
temperatures rise, however, likely curbed industrial output. Commerce Department data on Friday
is expected to show housing starts increased to a 983,000-unit pace in April, while permits rose
to a 1-million unit rate.
Dow 30 component Walmart is expected to report first-quarter results on Thursday. To combat
sluggish sales, broaden its customer base and fend off aggressive rivals, the retailer is
opening new small format stores and investors will be keen to hear how those locations have
performed. They will also be looking for details on the company's new money transfer business,
which is expected to drive traffic at its stores. According to StarMine, analysts expect the
company to miss both profit and sales estimates for the first quarter. Retailers Nordstrom and
Kohl's are also expected to post first-quarter results on the same day.
Cisco, scheduled to report third-quarter results on Wednesday, had earlier forecast a revenue
slide in the quarter, underlining its struggle to rekindle demand in emerging markets like China
even as hardware spending globally sags.
Deere & Co, the world's largest maker of tractor, harvesters and other agricultural equipment,
had warned that demand for its products would fall in most markets following a bumper crop that
sent commodity prices lower. Analysts expect crop receipts to fall 10 percent or more this year
when the company reports second-quarter results on Wednesday.
Analysts expect modest first-quarter sales growth when Macy's reports results on Wednesday. The
department store operator, like other U.S. retailers, is likely to have been hit by the
persistent cold weather. After posting weaker-than-expected comparable sales for the fourth
quarter, Macy's CEO had said business would return to normal once the weather improved and the
company left its full-year forecast unchanged. Investors will be eager to see whether the
company continues to stand by this guidance.
Chip equipment maker Applied Materials is scheduled to post fiscal second-quarter results on
Thursday and investors will be looking for new signs of a slowdown in the smartphone market.
Strong demand for mobile gadgets in recent years has offset weak spending on manufacturing
equipment by PC chipmaker Intel. But signs that the smartphone industry is now losing steam may
put pressure on on the contract chipmakers that buy Applied Materials' tools.
Advance Auto Parts is scheduled to report first-quarter results on Thursday. The retailer of
automotive parts to the replacement industry is likely to have gotten a boost from a harsh
winter in the first quarter. Investors will be looking for details on the progress of General
Parts International's integration into Advance Auto.
Struggling department store operator J.C. Penney is scheduled to report first-quarter results on
Thursday after a surprisingly good holiday quarter, in which both sales and margins rose amid a
highly promotional environment. The company has since been upbeat about its transformation
efforts and said it expects same-store sales to rise as much as 5 percent by 2015. All eyes,
however, will be on the performance of its overhauled home goods section and Wall Street will
also be looking out for updates on the performance of other turnaround initiatives.
Autodesk, which makes computer-aided design software, is expected to report strong first-quarter
results on Thursday, helped by higher subscriptions and higher sales of its software suites. The
company, like software maker Nuance, is in the process of transitioning to a subscription-based
The world's largest ammunition maker, Alliant Techsystems, is expected to report fourth-quarter
results on Thursday. It has focused on growing its sporting business as its defense unit stays
weak due to lower military spending. The sporting business is expected to account for about 45
percent of total revenue once the company's purchase of gun accessories company Bushnell is
fully integrated. Analysts are also expecting Alliant's aerospace business to grow, helped by
strong demand from commercial aircraft makers.
Solar panel maker Canadian Solar is expected to post a quarterly profit for the third straight
quarter when it reports first-quarter results on Friday, as demand from the United States and
Japan keeps improving. But China was subdued in the first quarter due to seasonal weakness. Weak
panel prices are also likely to continue to weigh on the company's results. Investors will be
looking for details on the solar power plant business and the company's plans to spin off some
plants into a separate, publicly-listed company.
Canada's report on March factory sales, due on Thursday, is expected to show a 1.4 percent
increase from February, when manufacturers registered their highest sales since the
pre-recession peak in July 2008. The data should help shed light on the export sector, which is
still struggling despite strengthening demand from the U.S. market. On Wednesday, Bank of Canada
Deputy Governor Lawrence Schembri speaks to a pension industry group. Market players will be
watching for signs that the central bank is more cautious in its outlook after disappointing
export and employment data.
Chinese online cosmetics retailer Jumei International Holding and car comparison website TrueCar
are scheduled to make their trading debuts on Friday. Jumei, backed by venture-capital firm
Sequoia Capital, is looking to raise up to $203 million by offering 9.5 million American
Depositary Shares at $19.50-$21.50 per ADS. TrueCar is looking to raise up to $109 million by
offering 7.78 million shares at $12-$14 per share. At the top end of the expected price ranges,
Jumei would be valued at a little over $3 billion and TrueCar would be valued at about $1
MONDAY, MAY 12
Drug wholesaler McKesson, part of the recent trend of U.S.-European healthcare mergers with its
acquisition earlier this year of Germany's Celesio, is scheduled to report fourth-quarter
Turquoise Hill Resources, which owns the Oyu Tolgoi copper and gold mine in Mongolia, reports
earnings for the first quarter. Analysts expect a loss of 2 cents a share. Turquoise Hill is
51-percent owned by global miner Rio Tinto, and owns 66 percent of the Oyu Tolgoi mine, with the
rest owned by the Mongolian government. The Canadian company said in March that full-year
production at the mine may be lower than previously forecast.
(Compiled By Ayesha Sruti Ahmed in Bangalore)