T. W. Merryman
Managing Director
Interconti, Limited
(Market Research Analysts)
Chicago, IL 60604
e: intercon@intercontilimited.com
w: www.intercontilimited.com
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03 October 2009
Earnings Season LOOMS - ferklempt or ferREAL?
Although Friday's trading exhibited admirable resiliency when faced with devastating employment numbers, equities markets could hit more speed bumps next week if the start of the third-quarter earnings season offers little evidence that the economic recovery is gaining strength. With second-quarter earnings primarily boosted by cost-cutting, investors want to see if the latest quarterly results will show an improvement in revenues. That's a priority for investors because revenue growth is deemed a crucial indicator of consumer and corporate spending.
Aluminum company Alcoa Inc, a Dow component, is scheduled to post quarterly results on Wednesday after the market's close, marking the unofficial kickoff of the latest earnings parade. The other marquee names on next week's brief earnings calendar are PepsiCo, Yum Brands Inc, Costco Wholesale Corp and Monsanto Co.
More takeover deals could also dictate next week's market action -- if there are any, according to analysts. A flurry of takeovers over the last two weeks has dominated the headlines as companies jostle to bolster their revenue streams in an uncertain economy. With corporate growth moving forward challenged, we could well be seeing the tip of a huge & growing iceberg in M&A as the fragmentation fomented by the likes of “Gordon Gekko” in the late 80’s and 90’s swing further toward conglomeration again just as public outcries against “too big to fail” proliferate.
Anybody else out there sense the same irony as I (do)??
Next week's economic calendar is light.
(below are highlights, click following graphic for full EconoDay version):
Monday,
Spotlight will be on the Institute for Supply Management's September index of activity in the vast U.S. services sector. ISM non-manufacturing, (or services) index, is forecast to have rebounded to 50.0, the dividing line between contraction and growth, after hitting 48.4 in August.
Tuesday,
NaDa
Wednesday,
Ditto
Thursday,
Investors also pay attention to monthly sales reports from major retailers to assess how consumers are faring as the job market remains weak.
Fed-Head Bernanke will be on center stage giving a speech on the controversial FED bank balance sheet before a conference in Washington the same day.
Friday,
Fed Vice Chairman Donald Kohn will speak on monetary policy and the financial crisis at the same conference.
T. W. Merryman
Managing Director
Interconti, Limited
(Market Research Analysts)
Chicago, IL 60604
e: intercon@intercontilimited.com
w: www.intercontilimited.com
T. W. Merryman
Managing Director
Interconti, Limited
(Market Research Analysts)
Chicago, IL 60604
e: intercon@intercontilimited.com
w: www.intercontilimited.com
Labels:
Weekly Market Preview part deux

