Altrice Investment Co. Limited – Last Weeks Close, Google and Economic Week Ahead
It was a rough week for the markets as trade fears continued to spook investors. The S&P 500 slid 4.6%, the Nasdaq tumbled 4.93%, and the Dow sank 1,149.51 points to close out the week.
"Despite the agreement on some issues, markets are still skeptical as to whether the Trump-Xi meeting was as successful as initially perceived," Altrice said to clients last week. "Looking ahead, the prospect for a trade deal within the 90-day time frame, in our view, is unlikely."
Google CEO Sundar Pichai is heading to Capitol Hill on Tuesday, December 11 to testify before the House Judiciary Committee. The original hearing was scheduled for Wednesday, December 5 but was rescheduled due to the National Day of Mourning to honor the late President George H.W. Bush. Pichai is the latest major tech executive to take the hot seat, where he is expected to be grilled about potential bias in the company's search results. Google was thrust into the spotlight in August when President Trump called out the search engine for being "rigged."
Consumer data will be in focus next week. Producer price index (PPI) data is scheduled to be released on Tuesday, consumer price index (CPI) data is expected on Wednesday and retail sales data will be released on Thursday.
"Lower oil and gasoline prices will be the key theme in the data releases next week, putting downward pressure on consumer and producer price inflation in November and holding down nominal retail sales," Altrice continued..
However, "Energy will impact the value of retail sales with gasoline station sales obviously heavily impacted. However, consumer confidence is good, and incomes are rising so outside of this component we expect sales to remain robust."
• Monday: JOLTS job openings, October (7 million in September)
• Tuesday: NFIB small business optimism, November (107.3 expected, 107.4 prior); PPI final demand month-on-month, November (0% expected, +0.6% prior); PPI ex food and energy month-on-month, November (+0.1% expected, +0.5% prior); PPI final demand year-on-year, November (+2.5% expected, +2.9% prior); PPI ex food and energy year-on-year, November (+2.5% expected, +2.6% prior)
• Wednesday: MBA mortgage applications, week ending December 7 (+2.0% prior); Consumer price index month-on-month, November (+0.0% expected, 0.3% prior); Consumer price index ex food and energy month-on-month, November (+0.2% expected, +0.2% prior); Consumer price index year-on-year, November (+2.2% expected, +2.5% prior); Consumer price index ex food and energy year-on-year, November (+2.2% expected, +2.1% prior); Monthly budget statement, November (-$165.0 billion expected, -$100.5 billion prior)
• Thursday: Import price index month-on-month, November (-1.0% expected, +0.5% prior); Initial jobless claims, week ending December 8 (227,000 expected, 231,000 prior); Continuing claims, week ending December 1 (1.63 million prior); Bloomberg consumer comfort index, week ending December 9 (60.3 prior)
• Friday: Retail sales advance month-on-month, November (+0.1% expected, +0.8% prior); Retail sales ex auto month-on-month, November (+0.2% expected, 0.7% prior); Retail sales ex auto and gas, November (+0.4% expected, +0.3% prior); Industrial production month-on-month, November (+0.3% expected, +0.1% prior), Capacity utilization, November (78.6% expected, 78.4% prior); Markit U.S. manufacturing PMI, December (55.1 expected, 55.3 prior); Market U.S. services PMI, December (55.0 expected, 54.7 prior); Business inventories, October (+0.5% expected, +0.3% prior)
This week will be light on the corporate earnings front.
Stitch Fix is set to report financial results Monday after the market close, and analysts are estimating earnings of 3 cents per share on $358.2 million in revenue. On Thursday, big-box retailer Costco and tech giant Adobe will report earnings after the bell. Analysts are estimating Costco will report earnings of $1.62 per share on $34.79 billion in revenue, and earnings of $1.89 per share on$32.43 billion in revenue for Adobe.
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