The stock market is coming off one of the most challenging weeks it has seen for some time: We witnessed lackluster corporate earnings, job cuts and currency issues, as well as weaker-than-expected purchasing managers index readings from China and the U.S. Thanks to all this, the S&P 500 dropped 2.8% for the week, erasing gains from earlier in the month and leaving the index down 3.15% so far in January.
While we could see more pain in the coming week, and possibly beyond that, this is also a time to revisit stocks that ran up big time in the last few months of 2013. As always, it's the prepared investor who can profit for the long term by identifying companies with favorable fundamentals -- and by buying when there is blood in the street.
In the next five days, unlike in the last two weeks, we'll have the pleasure of heavy-flowing earnings reports and economic data. More than 700 companies are due to report their quarterly earnings, and a significant percentage will offer their forecasts -- some just for the near term, and others for a bit longer. As I recently shared with The Street's Brittany Umar, for me the two key economic factors will be durable orders, scheduled for release Tuesday, and the personal income and spending report, which is set for Friday. But it's not the headline figures that I'll be watching. I'll be digging a few layers lower.
For instance, core capital-goods orders will shed some light on December manufacturing, and within this report I'll be looking to see confirmation of the activity dip seen in that month's Markit Economics Flash PMI. Given the hard weather we've been having here in the U.S., I would not be surprised to see at least a modest swoon.
With personal income and spending, I'll focus on disposable income, because that ties with discretionary spending. Those figures were essentially flat in October and November, but we also have to remember that those data were tainted by the government shutdown. If the numbers remain lackluster, it'll be a sign the U.S. consumer is still hurting -- and that would not be good for retail and restaurant stocks.
In terms of corporate earnings this week, it'll be a big one: The likes of Apple (AAPL), Google (GOOG), Qualcomm (QCOM), Facebook (FB), Caterpillar (CAT), Comcast (CMCSA), Boeing (BA) and Amazon (AMZN) are all due to report. That's just scratching the surface but, following the rash of outlooks that have been cut, investors will be putting the puzzle together and filling the picture in with pieces from those and other companies that are on tap this week.
For example, following poor results from Nokia (NOK) and Samsung last week, Apple, Google and Qualcomm are bound to shed some light on the state of the smartphone industry. I'll be examining this question in particular: Has the sector matured to the point at which we will see a seasonal pattern develop going forward, much like we do in other consumer electronic categories?
Another question will concern whether the tablet market is still growing, and that's a conversation that will loop in Amazon as well. I'll also be looking for answers about wearables: Are we close to seeing more? In the coming week, the one company that could have something interesting to say on that will be Corning (GLW).
Furthermore, what's going on real time in the emerging markets? Caterpillar, Colgate-Palmolive (CL) and others will help fill in that picture. Are consumers shunning cable services in favor of online viewing of content? Comcast will likely address that. Is the housing industry holding up? Tune in to D.R. Horton (DHI), ADT (ADT), M/I Homes (MHO) and Ryland Group (RYL).
Finally, are rising commodity prices -- in cocoa, beef, pork and chicken -- helping or hurting? Tyson Foods (TSN) and Hershey (HSY) will help answer that question this week.
Yep, there's a ton of data to be had this week, and to get your plan in place, here's a more granular look at the week ahead.
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Economic Calendar
Monday, Jan. 27
- New-Home Sales (December)
- Markit U.S. Flash Service Purchasing Managers Index (PMI)
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Tuesday, Jan. 28
- Durable Orders (December)
- Case-Shiller 20-City Index (November)
- Consumer Confidence (January)
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Wednesday, Jan. 29
- Mortgage Bankers Association (MBA) Mortgage Index (Weekly)
- Crude Oil Inventories (Weekly)
- Federal Open Market Committee (FOMC) Rate Decision (January)
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Thursday, Jan. 30
- HSBC China Manufacturing PMI
- Initial and Continuing Jobless Claims (Weekly)
- Gross Domestic Product (GDP) (Fourth Quarter of 2013)
- Pending Home Sales (December)
- Natural Gas Inventories (Weekly)
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Friday, Jan. 31
- Personal Income and Spending (December)
- Personal Consumption Expenditures (PCE) Prices -- Core (December)
- Employment Cost Index (Fourth Quarter of 2013)
- Chicago PMI (January)
- Michigan Sentiment Index - Final (January)
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Earnings Calendar
Monday, Jan. 27
- Apple Inc. (AAPL)
- American Electric Power Company (AEP)
- AU Optronics (AUO)
- Caterpillar Inc. (CAT)
- Heartland Financial (HTLF)
- Regis Corp. (RGS)
- Rambus Inc. (RMBS)
- Roper Industries (ROP)
- Sanmina-SCI Corp. (SANM)
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Tuesday, Jan. 28
- American Airlines (AAL)
- AK Steel (AKS)
- Amgen (AMGN)
- Air Products & Chemical (APD)
- Black Box Network (BBOX)
- Check Point Software (CHKP)
- Comcast Corp. (CMCSA)
- Crane Co. (CR)
- Cirrus Logic (CRUS)
- DuPont (DD)
- D.R. Horton (DHI)
- Danaher Corp. (DHR)
- Electronic Arts (EA)
- Ford Motor Company (F)
- Graco Inc. (GGG)
- Corning Inc. (GLW)
- II-VI Inc. (IIVI)
- Illumina Inc. (ILMN)
- Illinois Tool Works (ITW)
- J&J Snack Food (JJSF)
- Oshkosh Truck Corp. (OSK)
- Pfizer Inc. (PFE)
- Philips Electronics (PHG)
- Polaris Industries (PII)
- Pentair Inc. (PNR)
- RF Micro Devices (RFMD)
- STMicroelectronics NV (STM)
- AT&T (T)
- VMware (VMW)
- Water Corp. (WAT)
- Yahoo! Inc. (YHOO)
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Wednesday, Jan. 29
- Boeing Co. (BA)
- Cavium Networks (CAVM)
- Citrix Systems (CTXS)
- Amdocs Ltd. (DOX)
- Callaway Golf (ELY)
- EMC Corp. (EMC)
- Energizer Holdings (ENR)
- Evercore Partners (EVR)
- Facebook Inc. (FB)
- Fortune Brands Home & Security (FBHS)
- Fiat SpA
- Flextronics (FLEX)
- Fortinet Inc. (FTNT)
- Hanesbrands (HBI)
- JetBlue Airways (JBLU)
- Lam Research (LRCX)
- Las Vegas Sands (LVS)
- M/I Homes (MHO)
- McCormick & Co. (MKC)
- Marathon Petroleum (MPC)
- Meritor Inc. (MTOR)
- Piper Jaffray (PJC)
- Praxair Inc. (PX)
- Qualcomm Inc. (QCOM)
- Spectrum Brands (SPB)
- Symantec Corp. (SYMC)
- Tractor Supply (TSCO)
- Tupperware Brands (TUP)
- VistaPrint Ltd. (VPRT)
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Thursday, Jan. 30
- ADT Corp. (ADT)
- Applied Industrial Technologies (AIT)
- Amazon.com (AMZN)
- AutoNation Inc. (AN)
- Airgas, Inc. (ARG)
- Brink's (BCO)
- B/E Aerospace (BEAV)
- Ball Corp. (BLL)
- Broadcom Corp. (BRCM)
- The Blackstone Group (BX)
- Beazer Homes (BZH)
- Cardinal Health (CAH)
- Celgene Corp. (CELG)
- CEVA Inc. (CEVA)
- Colgate-Palmolive (CL)
- Chipotle Mexican Grill (CMG)
- DuPont Fabros Technology (DFT)
- Dover Corp. (DOV)
- ITT Educational Services (ESI)
- Google Inc. (GOOG)
- hhgregg, Inc. (HGG)
- Harley-Davidson (HOG)
- Hillshire Brands (HSH)
- The Hershey Company (HSY)
- JDS Uniphase (JDSU)
- Kennametal Inc. (KMT)
- Eli Lilly & Co. (LLY)
- MICROS Systems (MCRS)
- 3M Corp. (MMM)
- Altria Group (MO)
- NetSuite Inc. (N)
- PulteHomes (PHM)
- PerkinElmer (PHI)
- Potash Corp. (POT)
- The Pantry (PTRY)
- Raytheon Co. (RTN)
- Riverbed Technology (RVBD)
- Ryland Group (RYL)
- The Sherwin William Co. (SHW)
- The Timken Co. (TKR)
- Time Warner Cable (TWC)
- Under Armour (UA)
- United Parcel Service (UPS)
- Visa (V)
- Viacom Inc. (VIA)
- Whirlpool Corp. (WHR)
- Exxon Mobil Corp. (XOM)
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Friday, Jan. 31
- AON Corp. (AON)
- Booz Allen Hamilton (BAH)
- Banco Bilbao Vizcaya Argentaria (BBVA)
- Chevron Corp. (CVX)
- Eastman Chemical (EMN)
- Johnson Outdoors (JOUT)
- KKR Financial Corp. (KFN)
- Lear Corp. (LEA)
- Legg Mason, Inc. (LM)
- MasterCard Inc. (MA)
- Mattel Inc. (MAT)
- Mead Johnson Nutrition (MJN)
- Newell Rubbermaid (NWL)
- Paccar Inc. (PCAR)
- Tyson Foods (TSN)
- Tyco International (TYC)
- Weyerhaeuser Company (WY)
