US EQUITIES WEEK AHEAD:Alcoa, J.P. Morgan Results; Electronics Show

Date : 01/06/2012 @ 2:36PM
Source : Dow Jones News
Stock : Supervalu Inc. (SVU)
Quote : 16.19  -0.14 (-0.86%) @ 4:02PM

US EQUITIES WEEK AHEAD:Alcoa, J.P. Morgan Results; Electronics Show

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A handful of major companies, including aluminum producer Alcoa Inc. (AA) and banking giant J.P. Morgan Chase & Co. (JPM), are due to report their latest quarterly results next week.

Major electronics makers, including chip makers Intel Corp. (INTC) and Qualcomm Inc. (QCOM), will show off their latest gadgets at the International Consumer Electronics show, the world's largest consumer technology trade show.

Among the economic indicators due next week are data on November's trade balance and December import and export price indexes.

   Alcoa Expected To Post Lower Earnings 

Analysts polled by Thomson Reuters expect Alcoa to report a decline in fourth-quarter earnings and slightly higher revenue when it releases its latest results Monday. The aluminum producer's earnings more than doubled again in the third quarter as it recorded higher volume and prices, although sequentially prices declined and operating margin weakened.

Alcoa said Thursday it would permanently close or idle 12% of its aluminum-smelting capacity, following a year in which economic uncertainty slammed prices for the industrial metal. The company said it would take an after-tax charge of 15 cents to 16 cents a share on its fourth-quarter earnings.

Alcoa said the moves would improve its cost position and competitiveness. The company also said it would accelerate steps to reduce the escalating cost of raw materials.

   Reports Due From J.P. Morgan, Supervalu, Schnitzer 

Banking giant J.P. Morgan, supermarket operator Supervalu Inc. (SVU) and metal-recycling company Schnitzer Steel Industries Inc. (SCHN) are among the companies scheduled to report their latest quarterly results next week.

J.P. Morgan is the first big bank to report results and is watched as a barometer for the industry. Analysts expect J.P. Morgan to post lower earnings and revenue for its latest quarter, after it posted a slight drop in third-quarter earnings because of weak investment-banking operations.

Supervalu is expected to see slightly higher fiscal third-quarter earnings and a slight decrease in revenue, as the company struggles to reconcile rising food costs with prices to levels more competitive with rivals like Kroger Co. (KR) and Safeway Inc. (SWY). In October, Supervalu said it expected its growth to be stunted this fiscal year given the rocky economic environment and its reinvestments in the business.

Last month, Schnitzer disclosed it expects to post weaker-than-expected fiscal first-quarter results as a result of a weak global market for recycled metals.

   Largest Consumer Tech Trade Show Kicks Off Next Week 

Major electronics makers will show off their latest products at the International Consumer Electronics Show, to be held in Las Vegas, Tuesday through Friday. The trade show will feature about 2,700 exhibitors and include keynote speeches from Intel, Qualcomm, Ford Motor Co. (F) and Xerox Corp. (XRX) executives. Microsoft Corp. (MSFT), whose Chief Executive Steve Ballmer will again kick off the event with a keynote address, has said this will be the company's last appearance at CES.

   Data On U.S. Trade, Import Prices To Be Released 

The Commerce Department releases the November trade balance Friday. The trade deficit narrowed in October for the fourth month in a row, as oil exports helped to offset record imports from China.

The Labor Department will release December import and export price indexes Friday. U.S. import prices increased in November at the fastest pace since April as fuel costs jumped.

   Lee Enterprises Seeks To Advance Plan 

Lee Enterprises Inc. (LEE) will be in court next Friday to seek permission to enter into a deal with a group of lenders who have agreed to make sure a $175 million loan that forms the core of the newspaper publisher's plan to exit Chapter 11 protection gets funded.

Lee is asking the Wilmington, Del., bankruptcy court to sign off on a deal that would bind five lenders to convert a portion of their existing loans into new debt and equity under the company's reorganization plan. In addition, the so-called backstop lenders--Goldman Sachs Lending Partners LLC, Monarch Master Funding Ltd., Mutual Quest Fund, Blackwell Partners LLC and Mudrick Distressed Opportunity Fund Global LP--would have to cover any lenders who don't opt to undergo the conversion, ensuring that the $175 million loan gets funded.

Lee, the publisher of the St. Louis Post-Dispatch, the Arizona Daily Star and other newspapers, filed for Chapter 11 protection last month after an out-of-court refinancing effort failed.

   Treasury To Sell $66 Billion In Notes, Bonds Next Week 

As expected, the year's first round of U.S. government debt supply will come next week, with the Treasury Department offering $32 billion three-year notes, $21 billion 10-year notes and $13 billion 30-year bonds. The auctions will be held Tuesday, Wednesday and Thursday, respectively. Broadly speaking, U.S. Treasury auctions in 2011 went very well, with a number of sales raising debt at record-low yields. With the euro-zone crisis still looming large, these auctions may be greeted with similar demand even though U.S. economic reports have been improving of late--typically a signal to sell Treasurys.

  Geithner To Discuss Economy, Iran On Visit To Asia 

The U.S. Treasury Department said Secretary Timothy Geithner plans to go to China and Japan next week for meetings with top officials on the global economy and to also discuss increasing pressure on Iran.

The department announced Geithner plans to travel to Beijing and Tokyo Jan. 10-12. He is to meet with senior government officials in both countries to discuss the state of the global economy, policies to strengthen global growth and other economic issues.

Geithner also plans to discuss continued U.S. coordination with international partners in the region to increase pressure on the government of Iran, including financial measures targeting the central bank of Iran.

   Merkel, Sarkozy To Discuss Euro-Zone Solutions; ECB Bank Rate Seen On Hold 

German Chancellor Angela Merkel and French President Nicolas Sarkozy will meet Monday to discuss further efforts to tackle the euro zone's sovereign-debt problems and to enhance fiscal discipline among the 17-member currency bloc as part of a fiscal pact agreed at a summit last month. The Franco-German talks come ahead of a Jan. 23-24 meeting of European finance ministers and a Jan. 30 European Union summit to iron out details of the fiscal plan and steps to reinforce a financial firewall around economies with debt troubles, such as Italy and Spain.

Meanwhile, the European Central Bank is expected to keep rates on hold at its first meeting of the new year, and ECB President Mario Draghi is seen as likely to dampen expectations for a major debt-purchasing program from the central bank over the coming months.


Among the significant conferences next week are the J.P. Morgan Global Healthcare Conference in San Francisco, Monday to Thursday; the Sidoti & Co. LLC Semiannual New York Micro-Cap Conference in New York on Monday; the Needham Growth Conference in New York on Tuesday to Thursday; the Deutsche Bank Global Auto Industry Conference in Detroit, Tuesday to Wednesday; and the North American International Auto Show in Detroit, Monday through Jan. 22.

-By Nathalie Tadena, Dow Jones Newswires; 212-416-3287;

(Marie Beaudette, Cynthia Lin, Jeff Bater, Jenny Paris, William Kemble-Diaz, Ilona Billington and Dow Jones Newswires staff contributed to this report.)

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