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Fed presidents will be busy at speaking engagements next week, with all eyes on clarity on the
long-term vs short-term labor debate relative to wage pressures. Atlanta Fed's Dennis Lockhart
speaks on banking and monetary policy in Baton Rouge on Wednesday, while Cleveland President
Sandra Pianalto speaks on Thursday. Three Fed presidents speak on Friday - Kansas City's Esther
George, Richmond's Jeffrey Lacker and Pianalto. Senate Majority Leader Harry Reid is expected to
set a final vote on Stanley Fischer's Fed vice chairmanship when the Senate returns from its
Memorial Day recess the week of June 1.
Data next week is expected to show that the economy contracted in the first quarter and got off
to a sedate start in the April-June period. The Commerce Department's revisions on Thursday are
expected to show the GDP contracted at a 0.5 percent annual pace. It was previously estimated to
have expanded at a 0.1 percent rate. On Friday, the department is expected to report that
consumer spending increased 0.2 percent after jumping 0.9 percent in March.
A steadily increasing membership base has spurred Costco's comparable store sales growth since
last year as U.S. buyers look for cost-saving options amid a weak economy. Monthly same-store
sales have been strong in the year so far, signaling the company has not been affected by the
harsh winter weather that many other retailers have flagged for weak results. When Costco
reports third-quarter results on Thursday, investors will be focusing on new membership signups,
membership renewal rates and the rise in number of executive members. They will also be watching
out for the effect of currency fluctuations on the company's international operations, which are
expected to rub some shine off quarterly sales.
Chipmaker Avago Technologies is likely to report on Thursday second-quarter results below
analysts' average estimates, according to StarMine data. The company had warned of lower revenue
last quarter, saying it lost revenue from a smartphone customer. Analysts had speculated that
the customer to be Apple Inc.
Fashion accesories retailer Michael Kors is scheduled to report fourth-quarter results before
the bell on Wednesday amid high expectations after its trendy handbags and watches won over
holiday shoppers and the company raised its full-year forecast. The company has already grown
bigger than rival Coach and investors will look for an initial 2015 forecast.
Teen apparel retailer Abercrombie & Fitch is expected to post another decline in quarterly sales
when it reports results before the bell on Thursday. The company said earlier this year that it
would lower prices to battle competition and has been expanding its merchandise to include shoes
and larger clothes sizes for women to draw more shoppers. Investors will be looking out for any
commentary on when sales are expected to pick up and for new initiatives to boost sales.
Luxury homebuilder Toll Brothers is scheduled to report second-quarter results on Wednesday.
There is emerging evidence of a sector-wide weakness going beyond the unusual weather. While the
recent run up of interest rates might not worry the company, shortage of properties and labor
scarcity might weigh on the results.
Data analytics software maker Splunk has forecast first-quarter adjusted margins to shrink 8-10
percent as it invests in product development and hires more sales people. However, analysts
expect revenue to beat expectations due to strong growth in licensing revenue, as corporate and
government clients spend more on indexing and analyzing data. The company reports results on
Chinese solar company ReneSola is expected to report a much smaller first-quarter loss on
Thursday, helped by improving demand and prices for its panels from China. Investors will also
want to know if the China improvement is sustainable and will look for the company's U.S.
shipment forecast after it was named as a respondent in the U.S. Department of Commerce's
TUESDAY, MAY 27
The Commerce department is expected to report that durable goods orders fell 0.5 percent in
April after surging 2.5 percent in March. A measure of business spending plans is forecast to
rise 0.2 percent after increasing 2.9 percent in March. (0830/1230)
Weakness in auto parts retailer Autozone's do-it-yourself business could offset increased demand
due to extreme winter. When the company reports third-quarter results before the bell, the focus
will be on how it plans to grow its do-it-for-me business, which accounts for only 16 percent of
its overall revenue.
Web-based human resources software maker Workday's first-quarter profit and revenue are likely
to beat analysts' average expectations, according to StarMine data. The company has forecast a
rise of 61-67 percent in revenue in the first quarter, driven by subscription growth.
Chinese solar company JinkoSolar Holding is expected to post its fourth straight quarterly
profit as it benefits from sales to higher-margin markets such as Japan and the United States.
Investors will be looking for comments on the company's plans of spinning off its solar power
plant business and will also want to know if demand from China is improving.
(U.S. markets will remain closed on Monday, May 26, in observance of Memorial Day.)
(Compiled By Ayesha Sruti Ahmed in Bangalore)