June 19, 2015 / 7:55 PM / 4 years ago

What to Watch in the Week Ahead and on Monday, June 22

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Markets head into a quieter week in terms of data, so the biggest focus is likely to be the back and forth in the Greek debt crisis. Emergency weekend meetings might resolve the situation, but with some from the ECB warning that Greece may not open its banks on Monday, and also warning that officials won’t do anything to counter short-term volatility, the latest round of talks scheduled for Monday could create some potential volatility in markets, most notably transmitted through the euro, which has had substantial ups and downs depending on which rumor about a deal or no deal was out in the stratosphere. The U.S. Commerce Department issues final gross domestic product data for the first quarter and revised corporate profits data on Wednesday. On Tuesday, the department also issues May data for durable goods, which is expected to have decreased 0.5 percent, compared to the 1.0 percent drop in April. On the same day, the Federal Housing Finance Agency issues the house price index for April. On Thursday, the Labor Department releases weekly jobless claims data. Also on the same day, financial firm Markit releases its purchasing managers index for June. The PMI index for the services sector is expected to have slightly increased to 56.8 from 56.2 in May. The University of Michigan’s preliminary June reading on the overall index on consumer sentiment is expected to be released on Friday.

Nike Inc reports fourth-quarter results on Thursday. The world’s largest footwear maker is expected to report profit and sales above analysts’ average estimate, according to Thomson Reuters StarMine data. The beat is expected to be driven by high demand for sports and athletic apparel, basketball footwear, and strong sales growth on its website and mobile platforms. A recently-signed merchandising and marketing deal with the NBA and its extensive sponsorship at the 2015 FIFA Women’s World Cup are also expected to drive growth in coming quarters. Investors will look for Nike’s fiscal 2016 forecast and its comments on its core running assortment, the NBA deal, as well as the overall industry.

Federal Reserve Board Governor Jerome Powell participates in Q&A on economic policy with the Wall Street Journal in Washington on Tuesday. The governor will speak on “Monetary Policy Outlook and the Economy”. Separately, Federal Reserve Board Governor Daniel Tarullo participates in a “Conversation on the Economy and Financial Regulation” before the Council on Foreign Relations in New York on Thursday. Federal Reserve Bank of Kansas City President Esther George on Friday speaks on “The Payments System” at the bank’s “The Puzzle of Payments Security” conference in Kansas City, Missouri.

General Motors Co will host an event on Tuesday and Wednesday, during which it will introduce two new products, discuss product introductions, Chevrolet growth plans and talk about electrification, tech and R&D plans. Among the executives meeting with the media will be CEO Mary Barra, global product chief Mark Reuss and North American chief Alan Batey on Wednesday, and Chevy marketing chief Tim Mahoney on Tuesday. GM will host a conference call for analysts and investors on Thursday, led by Tom Timko, chief accounting officer, about the No. 1 U.S. automaker’s financial reporting.

Consulting and outsourcing company Accenture Plc on Thursday reports third-quarter results, which are expected to be slightly above analysts’ average estimate, according to Thomson Reuters StarMine data. Accenture has been benefiting from more business from companies looking to cut costs and improve efficiency in a tough economic environment. Investors will, however, look for the negative impact of a strong dollar, after the company in March cut the top end of its full-year earnings forecast range.

Micron Technology Inc reports third-quarter results on Thursday. The chipmaker is expected to report revenue and profit below analysts’ average estimate, according to Thomson Reuters StarMine data, primarily weighed down by weaker-than-expected demand from PC makers. Micron had forecast lower revenue for the quarter, saying it was willing to hold inventories longer in the face of waning demand for electronics featuring its technology. Analysts and investors will be keeping a close eye on its fourth-quarter forecast and commentary how it expects DRAM output to fare for the second half of the year.

On Tuesday, Carnival Corp, the world’s largest cruise operator, is expected to report second-quarter profit and sales above analysts’ average estimate, according to Thomson Reuters StarMine data. The company is expected to be helped by higher bookings and online spending by consumers, particularly in the Caribbean, its largest market. Investors will also be looking for Carnival’s third-quarter forecast, when the company usually earns the largest share of annual profit due to peaking demand in the summer.

Darden Restaurants Inc reports fourth-quarter results on Tuesday. The Olive Garden restaurant chain owner is expected to report a profit and sales largely in line with analysts’ average estimate, according to Thomson Reuters StarMine data. Investors will be looking for fiscal 2016 forecasts and further details on the company’s new cost saving initiatives and property deals. Darden had mentioned last quarter that it was looking to create value from real estate after traffic at its flagship Olive Garden chain continued to fall.

Lennar Corp, the second largest U.S. homebuilder, is expected to report a higher second-quarter profit on Wednesday, as it sold homes at higher prices. However, revenue could have been affected as heavy rainfall in southern United States likely impacted home closings. Lennar has a high exposure to Houston in the south, which accounted for about 10 percent of its total homebuilding revenue in 2014. Investors will look for an update on the company’s 2015 forecast.

Winnebago Industries Inc, the largest U.S. motorhome maker is expected to report on Thursday third-quarter profit below analysts’ average estimate, according to Thomson Reuters StarMine data. Average selling prices of motorhomes are expected to drop as the company faces lower demand for its top-end motorhomes. The company has also been struggling to recruit and retain employees at its main motorhome plant in Forest City. Investors will be looking to see if the company is able to contain its expenses, mainly for legal and equipment maintenance, as it pursues new strategic initiatives. Barnes & Noble Inc is expected to report a fourth-quarter loss on Thursday. The country’s largest bookstore chain is expected to report a decline in sales for the fourth straight quarter, according to Thomson Reuters I/B/E/S. The decline is expected to be driven by weak demand for its Nook e-readers and increasing competition from online retailers. To improve customer traffic, Barnes & Noble is focusing more on its retail stores and in August will spin off its college bookstores unit. It has also begun offering toys, craft beer kits and portable turntables together with a wide selection of signed books, and has been overhauling its stores and merchandising. Investors will look for fiscal 2016 forecast, comments on the spin-off and industry trends.

Fiat Chrysler CEO Sergio Marchionne presents first new Alfa Romeo model in Milan on Wednesday. The revamp of the brand is at the center of the carmaker’s plan to boost global vehicle sales by 60 percent to 7 million vehicles by 2018. The company forecast Alfa Romeo would multiply sales more than fivefold to 400,000 vehicles in 2018 by investing 5 billion euros to add eight new models and ramp up production.

The U.S Food and Drug Administration is expected to make a decision on Medicines Co’s blood clot preventer, Cangrelor, on Tuesday. The once-rejected injection aims to prevent blood clots during angioplasty, a procedure to widen narrow or clogged coronary arteries. The decision follows approvals of two of the company’s drugs, Ionsys and Raplixa, in April.

Creditbureau TransUnion will make its trading debut on Thursday. The company, whose competitors include Equifax and Experian, sells credit reports to help lenders assess the credit worthiness of borrowers. TransUnion filed for an IPO in 2011 but withdrew the offering in 2012 after it was sold to Advent International and Goldman Sachs by private equity firm Madison Dearborn Partners and the Pritzker family. Wayne Farms, the sixth-largest poultry producer in the country, will also debut on the same day. Wayne Farms’ clients include Nestle SA, Costco Wholesale Corp and Chick-fil-A, a fast food chain known for its chicken sandwiches. The company is the subsidiary of Continental Grain Co, among the largest privately held U.S. corporations.

Bank of Canada Deputy Governor Lawrence Schembri will give a speech at the Windsor-Essex Regional Chamber of Commerce on Thursday.

Brazil’s central bank releases data on unemployment rate in May on Thursday. On Wednesday, Mexico’s central bank releases data on inflation for the first half of June, which has been a plumbing historic lows. Economic activity data for April will also be released on the same day. Mexico’s National Statistics Institute issues trade balance data for May on Friday, which will show how factory exports and consumer imports fared after climbing in April.

MONDAY, June 22

Sales of previously owned homes likely recovered last month after falling unexpectedly in April, data from the National Association of Realtors is expected to show. Economists expect existing home sales jumped 4.4 percent to a 5.26 million unit-rate in May. The U.S. housing market has struggled for the past few months as tighter inventory push prices up. (1000/1400) Also, the Chicago Fed issues its national activity index for May. (0830/1230)

Oracle CEO Larry Ellison takes to the stage at the Oracle Cloud Platform Launch Event to explain his company’s move towards cloud computing. He will answer questions from analysts and customers.

Brazil’s central bank releases results of a weekly economic survey of more than 100 financial institutions. The survey will include forecasts for GDP, interest rates and inflation rates. Separately, the central bank is expected to release May data for current account and foreign direct investment. (0930/1330)

Mexico’s National Statistics Agency will release retail sales data for April. Retail sales jumped 0.2 percent in March. (0900/1300)

LIVECHAT- EUROZONE FOCUS: Aengus Collins, who is the lead euro zone analyst at the Economist Intelligence Unit, will be with us at 0500 ET (0900 GMT) to talk about Greece's prospects of financing itself and balancing its books as it struggles to reach an agreement on its debt pile with its creditors. To join the Global Markets Forum, click here: bit.ly/1kTxdKD (Compiled by Nivedita Balu; Editing by Savio D'Souza)

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