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When all else fails, bond and stock markets seem to want to move
higher. The S&P 500 has 2000 in its sights - a mere 2.5 percent
gain away - and with little economic news and no earnings to
speak of, the ongoing trend should keep the stock market in a
buoyant mood, even if it's a slow, steady grind higher. Bond
yields remain under pressure, owing to big demand from all sorts
of funds, lack of supply and a residual reaction from the
European Central Bank's big monetary policy move in this past
week. It puts both markets in a bit of a Goldilocks scenario
right now. Volumes will remain subdued as the seasonally slow
summer period approaches.
Retail sales data next week will likely cement expectations of a
sharp rebound in economic growth. The Commerce Department is
expected to report on Thursday that retail sales rose a solid
0.6 percent in May after gaining 0.1 percent in April. Core
retail sales are forecast bouncing back 0.4 percent after
slipping 0.1 percent in April. Producer prices data on Friday is
expected to show inflation at the factory gate cooling. The
producer price index for final demand is forecast rising 0.1
percent after accelerating 0.6 percent in April. Excluding food
and energy, the index is seen edging up 0.1 percent after rising
0.5 percent in April.
Canadian yogawear retailer Lululemon is expected to report
steady first-quarter earnings and slightly higher revenue on
Thursday. Investors are likely keen to hear the company's mid-
to long-term outlook. The results come as the trendy retailer
struggles to move past a high-profile recall of overly sheer
yoga pants more than a year ago and the subsequent fallout that
Oil and natural gas company Memorial Resource Development is
expected to raise about $648 million on Friday by offering 36
million shares at $16-$18 per share. At the top end of its
expected price range, Memorial Resource would be valued at about
Spanish renewable energy and engineering firm Abengoa's U.S.
subsidiary, Abengoa Yield, is expected to raise as much as $624
million on Friday by offering 23.1 million shares at $25-$27 per
share. At the top end of its expected price range, Abengoa Yield
would be valued at about $2.2 billion.
Bain Capital-backed plastics maker Trinseo SA's initial public
offering on Thursday is expected to raise about $190 million,
valuing the company at up to $900 million. Trinseo, formerly
Styron Corp, was bought by Bain from Dow Chemical Co in 2010.
The company derives majority of its revenue from Europe and
competes with specialty chemical companies such as BASF, Zeon
and Wacker Chemie AG.
Mobile security provider MobileIron's initial public offering on
Thursday is expected to raise about $110 million, valuing the
company at up to $747 million. MobileIron helps corporations
manage and protect data that employees access on personal
smartphones and tablets, a market once held closely by
Chinese jobs website operator Zhaopin is expected to raise about
$81 million in its initial public offering on Friday. The
company is selling about 5.61 million American Depositary Shares
and the price range is expected to be $12.50-$14.50 per ADS.
Data from Mexico on Tuesday will reveal whether gross fixed
investment in the country picked up in March, after expanding
1.4 percent in February. ANTAD retail sales data out the same
day will shed light on whether same-store sales rose in May,
after increasing 2.4 percent in April. April industrial
production numbers due on Wednesday will show whether March's
contraction of 0.13 percent boded for further deceleration in
MONDAY, JUNE 9
Remarks from the dovish chief of the Boston Fed, Eric Rosengren,
and the unpredictable but somewhat hawkish head of the St Louis
Fed, James Bullard, will be the focus of Federal Reserve
watchers this week. Neither Rosengren nor Bullard is a voter on
the Fed's policy-setting panel this year, but their comments are
sure to be parsed carefully for any hint of a change in the
Fed's policy outlook after a government report showed strong job
gains in May. Most observers believe the Fed is on course to end
its bond-buying before the end of the year and to raise rates
sometime in 2015. The Fed's self-imposed communications blackout
ahead of its June 17-18 meeting begins on Tuesday.
The Canada Mortgage and Housing Corp is scheduled to report data
for new home construction for May. The seasonally adjusted
annualized rate of housing starts rose to 194,809 last month.
Economic data from Mexico is expected to show whether inflation
continued to dip in May, from the six-month low of 3.5 percent
reached in April. (0900/1300)
(Compiled by Sourav Bose in Bangalore)