The Week Ahead: These Storms Will Take a Toll

 | Feb 16, 2014 | 8:00 PM EST  | Comments
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The S&P 500 rebounded 2.3% last week, putting in its best weekly return thus far this year. That pushed the index well off its year-to-date low, though the S&P is also down 0.5% so far for 2014. As that index climbed, along with the Dow Jones Industrial Average and the Nasdaq Composite Index, we were hit with another bout of severe winter weather that led to many disruptions across the U.S. There were cancelled flights -- including my own trip back to the greater D.C. area -- as well as production delays for homebuilders and missed retail sales, including Valentine's Day plans.

The winter storms will certainly take a toll on the economy this quarter. So far in 2014, due to the series of storms we have experienced, roughly 75,000 U.S. flights have been canceled, affecting 5.6 million passengers. Another 42.8 million have been hit by flight delays, as well, according to research firm masFlight. Still, all things being equal, this is all likely to create some pent-up demand that could give a modest goosing to the June quarter.

Weather aside, three items were of note last week.

To start with, Federal Reserve Chair Janet Yellen gave congressional testimony that was unsurprising, in my view, considering that it was her first round of it. She signaled that U.S. Treasury interest rates will remain low -- a comment that the stock market liked -- and that further tapering of quantitative easing will be data-dependent.

Second, data from Europe continue to perk up. That means the region will be adding to global growth this year, rather than acting as a drag, as it had done in 2012 and most of 2013.

Third, Comcast's (CMCSA) buyout bid for Time Warner Cable (TWC) ignited some consumer concerns – but, in my view, the move served as a warning call for companies like AT&T (T) and Verizon (VZ). Specifically, these companies need to get into the content game, lest they be reduced to data-pipe companies over time.

Let's now turn to the week ahead. It will be a shortened one because of the President's Day holiday -- but, that notwithstanding, we'll be getting a week's worth of economic data, particularly when it comes to the housing industry. Most important will be January housing starts and building permits. Expectations have dulled due to the weather, but the question remains as to how deep the drop was from November and December levels.

On Thursday, ahead of several flash purchasing managers index (PMI) reports, the Federal Open Market Committee (FOMC) will release its minutes from the Jan. 29 meeting. For those trying to get inside the Fed's head, that report tends to be fodder for the stock market and pundits alike. This time, commentary of additional stimulus tapering will be under the microscope.

As for earnings, it may seem as if no companies could possibly remain to report their December quarter, given the sheer volume of such numbers over the last few weeks -- but there are indeed more reports to come. Plenty of important names are on tap, as well: Wal-Mart (WMT), Hewlett-Packard (HPQ), Panera Bread (PNRA), and Coca-Cola (KO) are all scheduled for the next four trading days.

It'll also be rail-car week and hotel week. Trinity (TRN), FreightCar America (RAIL) and American Rail Car (ARII) are all set to issue their results and near-term outlooks, along with Choice Hotels (CHH), Host Hotels & Resorts (HST) and Marriott (MAR).

That's a small sampling of what's coming in the week ahead. Here's a more detailed view to prime you for the trading week ahead:

 

__________________

Economic Calendar

Monday, Feb. 17

  • Stock Market Closed -- President's Day

____

Tuesday, Feb. 18

  • Empire State Manufacturing Index (February)
  • Net Long-Term Treasury International Capital Flows (December)
  • National Association of Home Builders (NAHB) Housing Market Index

____

Wednesday, Feb. 19

  • Mortgage Bankers Association (MBA) Mortgage Index (Weekly)
  • Housing Starts (January)
  • Building Permits (January)
  • Producer Price Index (PPI) (January)
  • Federal Open Market Committee (FOMC) Minutes (Jan. 29 Meeting)

____

Thursday, Feb. 20

  • HSBC China Flash Manufacturing Purchasing Managers Index
  • Markit Eurozone Flash Composite PMI
  • Markit U.S. Manufacturing PMI
  • Initial and Continuing Jobless Claims (Weekly)
  • Consumer Price Index (CPI) (January)
  • Philadelphia Fed Index (February)
  • Leading Indicators (January)
  • Natural Gas Inventories (Weekly)
  • Crude Inventories (Weekly)

____

Friday, Feb. 21

  • Existing Home Sales (January)

_________________

Earnings Calendar

Monday, Feb. 17

  • Stock Market Closed — President's Day

____

Tuesday, Feb. 18

  • Analog Devices (ADI)
  • Choice Hotels (CHH)
  • Columbia Sportswear Co. (COLM)
  • Duke Energy (DUK)
  • Fluor Corp. (FLR)
  • Genuine Parts Co. (GPC)
  • The Coca-Cola Company (KO)
  • Medtronic (MDT)
  • Potbelly Corp. (PBPB)
  • Vasco Data Security (VDSI)
  • Wolverine World Wide (WWW)

____

Wednesday, Feb. 19

  • Yamana Gold (AUY)
  • HomeAway (AWAY)
  • CF Industries Holdings (CF)
  • Cinemark Holdings (CNK)
  • Cobra Electronics (COBR)
  • Denny's Corp. (DENN)
  • Devon Energy (DVN)
  • Equinix, Inc. (EQIX)
  • Franklin Electric (FELE)
  • Garmin Ltd. (GRMN)
  • Herbalife Ltd. (HLK)
  • Host Hotels & Resorts (HST)
  • Lumber Liquidators (LL)
  • LifeLock Inc. (LOCK)
  • MGM Mirage (MGM)
  • Panera Bread Co. (PNRA)
  • FreightCar America (RAIL)
  • Rubicon Technology (RBCN)
  • Spirit Airlines (SAVE)
  • Six Flags (SIX)
  • Safeway Inc. (SWY)
  • Tesla Motors (TSLA)
  • Veeco Instruments (VECO)
  • Westinghouse Air Brake (WAB)
  • Watts Water Technologies (WTS)

____

Thursday, Feb. 20

  • Acacia Research (ACTG)
  • American Railcar Industries (ARII)
  • Aruba Networks (ARUN)
  • Avis Budget Group (CAR)
  • Clear Channel CCO)
  • Curtiss-Wright Corp. (CW)
  • Dana Holding Corp. (DAN)
  • DirecTV Group (DTV)
  • Federal Mogul (FDML)
  • Flowserve Corp. (FLS)
  • Cedar Fair (FUN)
  • Groupon (GRPN)
  • Hewlett-Packard Co. (HPQ)
  • Hormel Foods (HRML)
  • IMAX Corp. (IMAX)
  • Immersion Corp. (IMMR)
  • Internap Network Services (INAP)
  • Intuit (INTU)
  • Jack in the Box (JACK)
  • Nordstrom (JWN)
  • Marriott International (MAR)
  • Allscripts (MDRX)
  • Maiden Holdings (MHLD)
  • Marvell Technology (MRVL)
  • Priceline.com Inc. (PCLN)
  • Patterson Companies (PDCO)
  • Sonus Networks (SONS)
  • Shutterstock (SSTK)
  • Starent Networks (STAR)
  • Tim Hortons (THI)
  • Trinity Industries (TRN)
  • Titan International (TWI)
  • WebMD Health (WBMD)
  • Walter Industries (WLT)
  • Wal-Mart Stores (WMT)
  • Yandex NV (YNDX)

____

Friday, Feb. 21

  • Agrium (AGU)
  • Boise Cascase (BCC)
  • Charter Communications (CHTR)
  • EchoStar Communications (DISH)
  • Express Scripts (ESRX)
  • Libbey Inc. (LBY)
  • Mohawk Industries (MHK)
  • Newmont Mining (NEM)
  • Pilgrim's Pride Corp. (PPC)
  • Ruth's Chris Steak House (RUTH)
  • Strayer Education (STRA)
  • Valmont Industries (VMI)

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