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  1. Home
  2. / Investing
  3. / Economic Data

The Week Ahead: Assessing This Rocky Start

This week's data will be particularly crucial.
By CHRIS VERSACE
Jan 19, 2014 | 08:00 PM EST
Stocks quotes in this article: FDX, FAST, CSX, C, MSFT, SBUX, JNPR, UNP, LMT, VZ, JNJ, TXN, EBAY, NFLX, PG, KMB, HON

2014 is off to a much rockier start than what the year-end rally would have predicted. A combination of earnings shortfalls, weaker-than-expected outlooks and layoffs are causing many investors to reassess the market, particularly after its strong run this past early October. Earnings shortfalls from FedEx (FDX), Fastenal (FAST), CSX (CSX) Citigroup (C) and others have added to recent warnings from a number of retailers. To be fair, we've seen several positive surprises as well. But, all said, this mixed earnings bag has put the stock market in a wait-and-see mode.

Currently, earnings estimates for S&P 500 companies average at $119.63 per share for all of 2014, up 10% from last year's $108.68. For perspective, that's nearly double the 5.3% growth EPS is tracking to have put in for 2013.

If fourth-quarter misses outnumber the number of companies that come in higher than expectations -- and if corporate outlooks come in as clear as mud -- odds are we will see a negative revision to earnings expectations for the year. That, in turn, would lead many people to question their stock-market-multiple expectations. The S&P 500 multiple closed Friday at 15.4x consensus earnings targets -- and, for those keeping score, companies in the index peaked at 17x 2013 earnings and bottomed at 13.6x.

That makes the upcoming week rather important, not only given the plethora of earnings reports on tap, but also because we will be getting the latest flash purchasing managers indices across the globe from HSBC and Markit Economics. Those releases are mostly due to come in Thursday.

As tends to happen, Thursday will also mark a hotbed of earnings calls, and there are a number of big ones on tap: Microsoft (MSFT), Starbucks (SBUX), Juniper Networks (JNPR), Union Pacific (UNP), and Lockheed Martin (LMT), among others. Ahead of that, there will be no shortage of companies to keep your eyes on, even though the stock market will be closed Monday due to the Martin Luther King holiday.

After the three-day weekend, Verizon (VZ), Johnson & Johnson (JNJ) and Texas Instruments (TXN) are set to kick off the earnings week, followed by eBay (EBAY) and Netflix (NFLX) Wednesday. Following the Thursday gauntlet, we'll see a far tamer Friday, though several heavyweights are due to report their results that day, including Procter & Gamble (PG), Kimberly-Clarke (KMB) and Honeywell (HON).

Yep, it's going to be a busy week, compressed into only four trading days. Here's a more detailed look at what's on tap in the week ahead:

_________________

Economic Calendar

Monday, Jan. 20

  • U.S. stock market closed

____

Tuesday, Jan. 21

  • No major economic indicators

____

Wednesday, Jan. 22

  • Mortgage Bankers Association (MBA) Mortgage Index (Weekly)

____

Thursday, Jan. 23

  • HSBC China Flash Manufacturing Purchasing Managers Index (PMI)
  • Markit France Flash Composite PMI
  • Markit Germany Flash Composite PMI
  • Markit Eurozone Flash Composite PMI
  • Markit U.S. Flash Manufacturing PMI
  • Initial and Continuing Jobless Claims (Weekly)
  • Federal Housing Finance Agency (FHFA) Housing Price Index (November)
  • Existing Home Sales (December)
  • Leading Indicators (December)
  • Natural Gas and Crude Inventories (Weekly)

____

Friday, Jan. 24

  • No major economic indicators

_________________

Earnings Calendar

Monday, Jan. 20

  • U.S. stock market closed

____

Tuesday, Jan. 21

  • Advanced Micro Devices (AMD)
  • TD Ameritrade Holding Corp. (AMTD)
  • Baker Hughes Inc. (BHI)
  • Rockwell Collins Inc. (COL)
  • Cree, Inc. (CREE)
  • Delta Airlines (DAL)
  • Forest Labs (FRX)
  • Interactive Brokers (IBKR)
  • Johnson & Johnson (JNJ)
  • The Travelers Companies (TRV)
  • Texas Instruments (TXN)
  • Verizon Communications (VZ)
  • Xilinx Inc. (XLNX)

____

Wednesday, Jan. 22

  • Abbott Labs (ABT)
  • eBay Inc. (EBAY)
  • 8x8 Inc. (EGHT)
  • F5 Networks (FFIV)
  • Motorola Solutions (MSI)
  • Netflix Inc. (NFLX)
  • Norfolk Southern Corp. (NSC)
  • Parker Hannifin Corp. (PH)
  • SanDisk Corp. (SNDK)
  • Tyco Electronics (TEL)
  • Textron Inc. (TXT)
  • U.S. Bancorp (USB)
  • United Technologies (UTX)
  • Western Digital (WDC)

____

Thursday, Jan. 23

  • Alaska Air Group (ALK)
  • Altera Corp. (ALTR)
  • Briggs & Stratton Corp. (BGG)
  • BankUnited (BKU)
  • Crown Castle International (CCI)
  • Cabot Microelectronics (CCMP)
  • Cypress Semiconductor (CY)
  • Discover Financial Services (DFS)
  • Dolby Labs (DLB)
  • E*Trade Financial (ETFC)
  • Ethan Allen Interiors (ETH)
  • Fifth Third Bancorp (FITB)
  • GATX Corp. (GMT)
  • Intuitive Surgical (ISRG)
  • Johnson Controls (JCI)
  • Jacobs Engineering (JEC)
  • Juniper Networks (JNPR)
  • Janus Capital Group (JNS)
  • KLA-Tenecor Corp. (KLAC)
  • Lockheed Martin (LMT)
  • Logitech International (LOGI)
  • Microsoft Corp. (MSFT)
  • Precision Castparts Corp. (PCP)
  • Starbucks Corp. (SBUX)
  • Synaptics (SYNA)
  • Union Pacific (UNP)
  • United Rentals (URI)

____

Friday, Jan. 24

  • Bristol Myers Squibb (BMY)
  • W.W. Grainger (GWW)
  • Honeywell International (HON)
  • Kimberly-Clark Corp. (KMB)
  • Kansas City Southern (KSU)
  • Leggett & Platt (LEG)
  • Procter & Gamble (PG)
  • State Street Corp. (STT)
  • Stanley Works (SWK)
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At the time of publication, Versace had no positions in the stocks mentioned.

TAGS: Investing | U.S. Equity | Economic Data | Stocks

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