The Week Ahead: Zero In on Banks

 | Jul 13, 2014 | 8:00 PM EDT  | Comments
  • Comment
  • Print Print
  • Print
Stock quotes in this article:

c

,

cma

,

gs

,

gs

,

jpm

,

bac

,

blk

,

wfc

,

csx

,

ksu

,

ge

,

hon

,

uri

,

aapl

,

swks

,

cy

,

yum

,

mcd

Late last week I attended a conference in Las Vegas and appeared on several business programs, including Kitco News and Power Trading Radio. When asked about last week's market action, I said I thought it was a limbo kind of week, and that investors were waiting for the real start to the June-quarter earnings season. Indeed, other than earnings results from Alcoa (AA) and Wells Fargo (WFC), there was little news flow to drive the market last week, be it economic or earnings-related. Yes, we saw that modest whipsaw from Portugal's bank crisis, but by and large investors were waiting for what's due to begin Monday.

The coming week will be chock-full of economic data and corporate earnings. The full listing of economic data can be found below, but the numbers on which to focus include Tuesday's June retail sales; Wednesday's producer price index and industrial-production figures, and the latest Federal Reserve Beige Book; and June housing starts on Thursday. Commentary from both Family Dollar Stores (FDO) and The Container Store (TCS) pointed to weak consumer traffic, but the consensus expectation for June retail sales, excluding autos, is for a gain of 0.6% -- up from a worse-than-expected 0.1% in May.

As for PPI, May's number showed a contraction, while that month's consumer price index ran hotter than expected. At the same time, several industrial reports from the Institute for Supply Management and Markit Economics point to higher input prices in several geographies around the world -- so inflation hawks will be closely eyeing the June PPI figure.

In terms of housing numbers, May saw dips in overall and single-family starts, even as building permits ran better than 1 million per month in February, March and April. Homebuilder shares, such as those of Toll Brothers (TOL) and D.R. Horton (DHI), have been in the penalty box over lingering housing-market concerns. If we get another disappointing housing starts figure for June, it will be hard for to see renewed excitement for homebuilder shares near-term.

Looking at what's on tap from an earnings perspective, this week will be very heavy with financial companies: Citigroup (C), Comerica (CMA), Goldman Sachs (GS), JPMorgan Chase (JPM), Bank of America (BAC), BlackRock (BLK) and several others are all scheduled to issue quarterly results in the first half of the week. We know trading volume has been light, but this quarter has witnessed a pick-up in mergers and acquisitions, and there's been strong initial-public-offering activity as well. With 60 IPOs, the June quarter marked the most debuts since the fourth quarter of 2006. That suggests bank results should be better than those of Wells Fargo (WFC), which were released last week.

The second big category of earnings this week is set to come from the industrials. Ahead of reports from CSX (CSX), Kansas City Southern (KSU), General Electric (GE), Honeywell (HON) and others, industrial data as well as rail traffic have been more than favorable and bode well for solid results.

One company that should particularly have your attention, given the nature of its business, is United Rentals (URI) -- if volume, time and overall fleet-utilization rates are strong, these numbers will confirm the pick-up in industrial activity. Because we've already received a great deal of June industrial data, including industrial-production figures earlier in the week, United Rentals' comments on the current quarter to date will be far more insightful.

As we try to piece together the timing of new smartphone and tablet models in the back half of the year, particularly regarding Apple's (AAPL) new iPhone 6, comments on September-quarter activity from both Skyworks Solutions (SWKS) and Cypress Semiconductor (CY) will be scrutinized closely. Given its mobile position, Skyworks' conference call will likely provide a solid update on the real status of burgeoning connected-device markets, such as those of the connected home and the connected car.   

Friday is due to bring us results from Yum! Brands (YUM), and that means insight into the health of China's economy. Aside from that, another data point to watch will be the fortunes of Yum chain Taco Bell, given such breakfast initiatives such as the Waffle Taco. It's not a secret that McDonald's (MCD) has been on the ropes of late -- among other things, it was named among the major U.S. burger chains with the worst-tasting hamburgers -- and Waffle Taco success could mean things are even worse for McDonald's than we realize.

Following is a more detailed look at what you can expect over the next several trading days. Be sure to check back midweek for The Corner of Wall & Main, in which Lenore Hawkins and I dish on the first half of the trading week and other key matters and thoughts -- as well as how to play it all.

_________________

Economic Calendar

Monday, July 14

  • [No major economic releases scheduled]

____

Tuesday, July 15

  • Retail Sales (June)
  • Empire Manufacturing (July)
  • Import and Export Prices (June)
  • Business Inventories (May)

____

Wednesday, July 16

  • Mortgage Bankers Association (MBA) Mortgage Index (Weekly)
  • Producer Price Index (PPI) (June)
  • Net Long-Term Treasury International Capital (TIC) Flows (May)
  • Industrial Production (June)
  • Capacity Utilization (June)
  • National Association of Home Builders (NAHB) Housing Market Index (July)
  • Crude Inventories (Weekly)
  • Federal Reserve's Beige Book (July)

____

Thursday, July 17

  • Initial and Continuing Jobless Claims (Weekly)
  • Housing Starts and Building Permits (June)
  • Philadelphia Fed Index (July)
  • Natural Gas Inventories (Weekly)

____

Friday, July 18

  • Michigan Sentiment Index (July)
  • Leading Indicators (June)

_________________

Earnings Calendar

Monday, July 14

  • Citigroup (C)
  • Cintas Group (CTAS
  • Peregrine Pharmaceuticals (PPM)

____

Tuesday, July 15

  • Comerica (CMA)
  • Goldman Sachs (GS)
  • Intel Corp. (INTC)
  • Johnson & Johnson (JNJ)
  • JPMorgan Chase (JPM)
  • Rocky Mountain Chocolate (RMCF)
  • Wolverine Worldwide (WWW)
  • Yahoo! Inc. (YHOO)

____

Wednesday, July 16

  • Abbott Labs (ABT)
  • Adtran Inc. (ADTN)
  • Bank of America (BAC)
  • BlackRock Inc. (BLK)
  • CSX Corp. (CSX)
  • eBay Inc. (EBAY)
  • Kinder Morgan (KMI)
  • Las Vegas Sands (LVS)
  • Northern Trust (NTRS)
  • PNC Financial Services (PNC)
  • Pinnacle Financial (PNFP)
  • Select Comfort (SCSS)
  • SanDisk Corp. (SNDK)
  • St. Jude Medical (STJ)
  • Textron (TXT)
  • U.S. Bancorp (USB)

____

Thursday, July 17

  • Advanced Micro Devices (AMD)
  • AutoNation (AN)
  • B&G Foods (BGS)
  • Baker-Hughes (BHI)
  • Blackstone Group (BX)
  • Capital One (COF)
  • Cypress Semiconductor (CY)
  • Danaher Corp. (DHR)
  • Dover Corp. (DOV)
  • Fairchild Semiconductor (FCS)
  • Google (GOOGL)
  • W.W. Grainger (GWW)
  • IBM (IBM)
  • Mattel (MAT)
  • Morgan Stanley (MS)
  • Orbital Science (ORB)
  • Philip Morris (PM)
  • PPG Industries (PPG)
  • Sherwin-Williams (SHW)
  • Snap-On Inc. (SNA)
  • Skyworks Solutions (SWK)
  • Universal Forest Products (YFPI)
  • UnitedHealth (UNH)
  • United Rentals (URI)
  • Yum! Brands (YUM)

____

Friday, July 18

  • athenahealth (ATHN)
  • Bank of New York Mellon (BK)
  • First Horizon (FHN)
  • General Electric (GE)
  • Honeywell International (HON)
  • Interpublic Group (IPG)
  • Johnson Controls (JCI)
  • Kansas City Southern (KSU)
  • Schlumberger Ltd. (SLB)
  • VF Corp. (VFC)
  • Valmont Industries (VMI)

Columnist Conversations

I'm eyeing possible support in this one....writing about this tonight! View Chart &raq...
It was a quiet start to the week, in as much as the broader market was concerned. With only three trading day...
Market closes flat as oil & commodities take hit today on back of stronger dollar...something that could c...
Latest PAYX/IHS Small Business Jobs Index released today...Mountain region and Texas metro continue to lead th...

BEST IDEAS

REAL MONEY'S BEST IDEAS

Columnist Tweets

BROKERAGE PARTNERS

Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.


TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.