Editorial StaffInvestors are looking ahead to another busy week of earnings reports and some key economic releases that will provide more insight into the health of the consumer and housing market.
Corporate earnings continue to top expectations with around 88% of companies beating analysts’ forecasts for the last quarter. That has prompted some analysts to raise their earnings forecasts for the third quarter. According to FactSet, the bottoms-up EPS estimate—which is an aggregation of the median EPS estimates for Q3 for all the companies in the index—has increased by 3.6%. While not at record levels, it’s worth noting that analysts typically lower their forecasts every quarter by about 1.7% on aggregate. They are expecting profit growth to continue.
Look out for:
- Industrial production figures from the EU and India are due for release on Thursday.
- 1,100 U.S. companies, including Disney, eBay, Airbnb, and DoorDash report earnings this week.
- The U.S. consumer sentiment report is due for release on Friday.
Events Calendar:
Monday August 9:
- U.S. Job Openings (June).
Tuesday August 10:
- DoorDash (DASH) and Aramark (ARMK) Report Earnings.
- NFIB Small-Business Index (July).
Wednesday August 11:
- eBay (EBAY), Nio (NIO) and iQiyi (IQ) Report Earnings.
- U.S. Consumer Price Index (July).
- China Vehicle Sales YOY.
- Japan PPI YOY.
Thursday August 12:
- Walt Disney (DIS), Sonos (SONO), Wendy’s (WEN) and Airbnb (ABNB) Report Earnings.
- U.S. Producer Price Index (July).
- EU Industrial Production YOY.
- India Industrial Production YOY.
- India Manufacturing Production YOY.
Friday August 13:
- U.S. Consumer Sentiment Report (August).
- U.S. Mortgage Applications (July).
- EU Balance of Trade (June).
- China FDI (YTD) YOY.
Earnings Ahead
1,100 U.S. companies will report second quarter results in the coming week, including Disney (DIS), eBay (EBAY), Airbnb (ABNB), Sonos (SONO), Wendy’s (WEN) and DoorDash (DASH).
Disney’s earnings will be of particular interest as the company grapples with reopening its global theme parks amid the spread of the delta COVID-19 variant, and continuing to grow its Disney+ streaming platform. Disney has a slew of new movie releases set to debut in the second half of the year, including Encanto, Eternals, and Shang-Chi and the Legend of the Ten Rings. How and where those films release will be important to the bottom line of the Magic Kingdom.
Housing and Spending
On Wednesday, we’ll get reports on core inflation in the U.S. for July, as well as the inflation rate. Both climbed in June as consumer prices jumped 0.9% from May, so we should expect another increase for July. Higher prices have yet to really scare consumers from spending, but economists are starting to doubt their resiliency. On Friday we’ll get the consumer sentiment report for August. It fell 5% in July from June levels, but was still 12% higher than the same period last year.
We’ll also get a report on mortgage applications for July. The housing market has started to cool down in the U.S., and should continue to do so as we head into the slowest months of the year for home buying. But ultra-low mortgage rates continue to lure buyers and refinancers back into the market.
Source: Investopedia
