All eyes will be on the Federal Reserve's interest-rate panel to
see if it makes a symbolic policy shift or takes more concrete
steps to boost the economy at its meeting Tuesday.
The pace of second-quarter reports will slow dramatically next
week, with two Dow Jones Industrial Average components and more
than a dozen companies in the Standard & Poor's 500 Index
scheduled to post results.
Economic reports next week will cover preliminary second-quarter
productivity figures, the June trade deficit, and retail sales and
consumer inflation last month.
FOMC Faces More Pressure To Act Tuesday
A poor jobs report Friday and other recent indications that the
economy is weakening are increasing pressure on the Federal Open
Market Committee to take some action at its meeting Tuesday. The
panel already has cut short-term interest rates close to zero, but
it could take other steps, including signaling markets that
interest rates will stay near zero for a longer time, lowering the
interest rate on reserves banks place at the central bank, or
reviving a program used during the recent financial crisis and buy
mortgage bonds and Treasurys.
Disney Results Seen Higher On Ad, Film Sales
Walt Disney Co. (DIS), which reports fiscal third-quarter
results Tuesday, is the last of the media giants to post results.
Most of the others have seen bigger profits on rebounding
advertising. Analysts polled by Thomson Reuters expect Disney to
report improved results as it also benefits from strong ticket and
consumer-product sales for "Toy Story 3" and DVD sales of "Alice in
Wonderland." Investors will be watching for signs of improvement in
the theme parks and resorts segment.
Cisco Likely To Benefit From Business Spending
Cisco Systems Inc. (CSCO), which reports fiscal fourth-quarter
results Wednesday, also is expected to top prior-year levels on a
continuing rebound in corporate technology spending. The big
Silicon Valley maker of networking gear, which has been moving into
new businesses and expanding its market share, has seen customers
in a growing number of regions snap up more varieties of
communications and computing hardware.
Retailers To Report After Mixed July Sales Data
Major retailers begin reporting fiscal second-quarter results
next week after posting mixed results in July same-store sales.
Macy's Inc. (M), which reports Wednesday, greatly exceeded
expectations with a 4.5% increase. J.C. Penney Co. (JCP), whose
same-store sales fell 0.6% when a 3.4% gain was expected, will post
results next Friday, a day after fellow department-store chains
Nordstrom Inc. (JWN) and Kohl's Corp. (KSS).
Small Rise Seen In July Consumer Price Index
Economists expect the consumer price index, a key measure of
retail inflation, increased 0.2% in July, or 0.1% on a core basis,
after the overall figure dropped 0.1% a month earlier, according to
a survey of economists by Dow Jones Newswires. The CPI, to be
released next Friday, has grown in only one of the past five
months, March. The government also will report on July retail sales
and June business inventories next Friday, when Reuters/University
of Michigan releases its preliminary August reading on its consumer
sentiment index. The government will detail second-quarter
productivity and June wholesale inventories Tuesday, followed a day
later by the trade deficit figures for June.
Monsanto's Field Day Could Change Tone
Monsanto Co. (MOS) investors will head to rural Nebraska for the
seed company's annual field day, called "Whistle Stop Tour V." The
event, in Gothenburg, Neb., comes after a year in which the company
has scaled back its Roundup herbicide business because of intense
price pressure from generic glyphosate brands and dealt with
emerging weed resistance to the chemical. It also has faced
criticism from farmers about the price of its seeds.
Jefferies analyst Laurence Alexander said investors should not
expect concrete data on crop yields or pricing. "It's all about the
adjectives," he said, noting that Monsanto stock has rallied 36%
from its lows earlier in the year and "there also appears to be
optimism the Aug. 11-12 investor day will shift the tone" for the
company.
House To Vote On $26B Aid Bill For States
House Speaker Nancy Pelosi (D., Calif.) has called House members
back from their summer recess Tuesday to vote on a $26 billion bill
offering aid to states and send it to the desk of President Barack
Obama. The Senate on Thursday approved the measure, designed to
prevent teacher layoffs and help states with their Medicaid
payments.
Feinberg To Hold Forums On Spill Claims
Ken Feinberg, the independent administrator of the Deepwater
Horizon Victims Compensation Fund, will hold community forums
Tuesday in Pensacola and Panama City Beach, Fla., where the public
may ask about claims processing for those hurt by the massive oil
spill in the Gulf of Mexico. The events, sponsored by Sen. Bill
Nelson (D., Fla.) and Rep. Allen Boyd (D., Fla.), also will report
on the latest cleanup efforts by oil giant BP PLC (BP, BP.LN).
ABA Meeting To Discuss Financial Overhaul
The implications of the recent financial-overhaul legislation
passed by Congress are among the topics to be discussed at the 2010
American Bar Association annual meeting through Tuesday in San
Francisco. Among the scheduled speakers at the five-day event are
former Intel Corp. (INTC) Chairman Andrew Grove and Supreme Court
Associate Justice Ruth Bader Ginsburg, who will receive the ABA
Medal, the association's highest honor.
Conferences
Among the significant conferences next week are the Pacific
Crest Securities Technology Leadership Forum from Sunday through
Tuesday in Vail, Colo.; J.P. Morgan Auto Conference on Monday and
Tuesday in Detroit; Needham & Co. Clean Technology Conference
on Monday in New York; Canaccord Adams Global Growth Conference
from Tuesday through Thursday in Boston; Jefferies & Co. Global
Industrial and A&D Conference from Tuesday through Thursday in
New York; Oppenheimer & Co. Telecommunication, Media &
Technology Conference on Tuesday and Wednesday in Boston; Morgan
Keegan Technology Conference on Wednesday and Thursday in New York;
and Bank of America Merrill Lynch Specialty Pharmaceuticals
Conference on Thursday and Friday in Southampton, N.Y.
-By Kathy Shwiff, Dow Jones Newswires; 212-416-2357;
kathy.shwiff@dowjones.com
(Ian Berry and other Dow Jones Newswires staff contributed to
this article.)
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