The final week of May will be critical for the markets as
volatility hit a number of regional stock indices this week,
although the United States was largely spared.
For the week, the S&P 500 lost a little better than 1
percent, but this paled in comparison to losses in Japan, where the
Nikkei fell more than 7 percent on Thursday. Traders will be
watching earnings announcements from the likes of Tiffany (NYSE:
), Michael Kors (NASDAQ:
), Dollar General (NYSE:
), The Fresh Market (NASDAQ:
), Avago Technologies (NASDAQ:
), Costco (NASDAQ:
), and Guess? (NYSE:
), among others.
On the economic front, consumer confidence numbers for the month
of May will be out on Tuesday. Other domestic reports that will be
of interest to the market include jobless claims and the second GDP
estimate, both of which are due out on Thursday. Pending home sales
data will also be due out on Thursday. On Friday, key economic
reports include Chicago PMI and the final reading of the University
of Michigan Consumer Sentiment index.
On Tuesday, May 28, luxury retailer Tiffany is expected to
release its quarterly earnings results prior to the opening bell.
Heading into the report, Wall Street analysts have consensus EPS
estimates of $0.52, representing a year over year decline of almost
19 percent compared to the $0.64 the company reported in last
year's corresponding period. Sales are expected to be up 4.40
percent to $855.14 million.
Shares closed Friday's trading session essentially flat at
$76.21. Year-to-date, Tiffany has risen nearly 33 percent on the
back of a strong market.
In a client note from Thursday, analysts at Deutsche Bank noted
that the company previously guided for net earnings from operations
to fall around 15 to 20 percent due to gross margin pressure and
higher marketing-related costs. The company said that it sees
earnings growth in all subsequent quarters. The stock is currently
trading above Deutsche Bank's price target of $68.50.
On Wednesday, May 29, The Fresh Market is scheduled to release
its quarterly results before the opening bell. Analysts expect the
company to report a 10 percent rise in earnings per share to $0.44
from $0.40 last year. Sales are expected to rise 13.80 percent to
The stock climbed a little less than 1 percent on Friday to
close at $46.10. Year-to-date, TFM has lost more than 4 percent,
significantly underperforming the broader market.
In a client note from Thursday, Deutsche Bank analysts wrote
that "recent strength at WFM gives us some confidence that trends
at TFM may be improving, at least modestly." The firm is looking
for EPS above current Street consensus, but noted that the company
has missed estimates in its last two quarters. Deutsche Bank
reiterated its Hold rating on the stock and $40.00 price
Avago Technologies is expected to release its quarterly results
after the market close on Wednesday. Heading into the report,
analysts are modeling a decline of almost 15 percent in EPS to
$0.52 from $0.61 in the year ago period. Sales are expected to be
down 3.30 percent to $558.24 million.
The stock closed up 0.38 percent on Friday to $34.10. In 2013,
AVGO has risen a little less than 8 percent, underperforming the
Analysts at Deutsche Bank wrote that "AVGO shares have
underperformed peers in recent weeks as we believe investors fear
the co's upcoming F2Q results/guide will yield estimate cuts." They
added that while Deutsche Bank estimates are slightly below current
consensus, the firm's detailed end-market analysis "leaves us
comfortable with our ests, which we believe are better than
buy-side fears." The firm reiterated its Buy rating and $40.00
price target on the stock ahead of Wednesday's report.
On Tuesday, the Conference Board's Consumer Confidence Index is
expected to rise to 72.5 for May versus 68.1 in April. Wednesday's
initial jobless claims data is forecast to stay flat at 340,000 for
the week ending May 25. Continuing claims are expected to rise to 3
million for the week ending May 18, a rise from the 2.912 million
continuing jobless claims reported in the prior week. The GDP
second estimate is expected to show GDP was up 1.2 percent in the
International economic reports that the market will be watching
next week include Canada's interest rate decision on Wednesday and
Chinese Manufacturing PMI data on Friday. Canada's central bank is
expected to hold interest rates steady at 1 percent while there is
no forecast for Chinese PMI. In the prior period, the index came in
at 50.60, showing very modest expansion.
Earnings from: Canadian Solar (NASDAQ:
), Seadrill (NASDAQ:
), Tiffany (NYSE:
), and Wet Seal (NASDAQ:
), among others Swiss Employment level, U.S. consumer confidence,
Japanese retail sales
Earnings from: Dollar General (NYSE:
), Michael Kors (NASDAQ:
), The Fresh Market (NYSE:
) and Avago Technologies (NASDAQ:
), among others. German Unemployment, Brazilian GDP, German CPI,
Canadian interest rate decision, U.S. Redbook
Earnings from: Big Lots (NYSE:
), Costco (NASDAQ:
), Express (NASDAQ:
), Joy Global (NYSE:
), Sanderson Farms (NASDAQ:
), Guess? (NYSE:
), and Lions Gate Entertainment (NYSE:
), among others. Swiss GDP, U.S. GDP, U.S. jobless claims, U.S.
pending home sales
Earnings From:Frontline (NYSE:
), Genesco (NYSE:
), and Graham (NYSE:
) Indian GDP, French consumer spending, EU unemployment rate,
Canadian GDP, U.S. personal income and spending, U.S. Core PCE
Price Index, Chicago PMI, Michigan Consumer Sentiment and Chinese
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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