What to expect in the week ahead (IBM, NFLX, KO, INTC)

Moomoo Breakfast US wrote a column · Jul 18, 2021 19:50

What to expect in the week ahead (IBM, NFLX, KO, INTC)

Weekly market recap

For the week, $Dow Jones Industrial Average (.DJI.US)$was back down 0.5%, threatening to snap a string of weekly gains; the $S&P 500 Index (.SPX.US)$is headed for a weekly decline of 0.9%, while the $Nasdaq Composite Index (.IXIC.US)$is looking at a weekly decline of 1.8%

Stocks enter a busy week for earnings news with two perplexing questions hanging over the market.

One is whether the big gains in corporate profits will start to boost stocks with solid earnings reports. That was not the case for some financial sector stocks this past week. The other question is whether the surprise decline in the 10-year Treasury note yield is sending a message that stock investors should heed.

Stocks had a rocky day Friday, selling off into the closing bell. Defensive sectors, like health care, consumer staples and utilities gained in the session, while cyclicals, like energy and materials were hit hard.

Here's a look at the returns of S&P 500 sectors.

Source: jhinvestments

The week ahead in focus

Airlines, railroads, drug companies and tech are among the many industries reporting results in the week ahead.

"Earnings have the spotlight in the coming week," said Sam Stovall, chief investment strategist at CFRA. "You're not going to see economic data upstage earnings."

James Paulsen, chief investment strategist at The Leuthold Group, said earnings may be more of a factor for stocks in the much quieter week ahead. In the past week, the market focus was on two days of testimony from Federal Reserve Chairman Jerome Powell and important data, like the consumer price index and retail sales.

Monday 7/19

IBM, J.B. Hunt Transport Services, $PPG Industries (PPG.US)$, $Prologis (PLD.US)$, $Tractor Supply (TSCO.US)$, and Zions Bancorp report quarterly results.

$L Brands Inc (LB.US)$holds a conference call to discuss the spinoff of its Victoria's Secret brand. The new company, to be called Victoria's Secret, is expected to trade under the ticker VSCO on the New York Stock Exchange in early August. The remaining company will be renamed Bath & Body Works, and also have a new stock symbol, BBWI.

The National Association of Home Builders releases its NAHB/Wells Fargo Housing Market Index for July. Consensus estimate is for an 82 reading, slightly higher than the June data. Home builders remain quite bullish on the housing market, but the June figure was the lowest since August 2020, amid rising materials prices and supply-chain shortages.

Tuesday 7/20

$Chipotle Mexican Grill (CMG.US)$, $Citizens Financial (CFG.US)$, $Halliburton (HAL.US)$, $HCA Healthcare (HCA.US)$, $Intuitive Surgical (ISRG.US)$, $KeyCorp (KEY.US)$, $Netflix (NFLX.US)$, $Philip Morris International (PM.US)$, $Synchrony Financial (SYF.US)$, Travelers, and United Airlines Holdings announce earnings.

The Census Bureau reports new residential construction data for June. Economists forecast a seasonally adjusted annual rate of 1.6 million housing starts, slightly more than the June figure.

Wednesday 7/21

Anthem, $ASML Holding (ASML.US)$, $Baker Hughes (BKR.US)$, Coca-Cola, Crown Castle International, $CSX Corp (CSX.US)$, Johnson & Johnson, Nasdaq, $Northern Trust (NTRS.US)$, $Novartis AG (NVS.US)$, SAP, $Seagate Technology (STX.US)$, Texas Instruments, and Verizon Communications release quarterly results.

Thursday 7/22

The NAR reports existing-home sales for June. Economists forecast a seasonally adjusted annual rate of 5.8 million, matching the May figure. Existing-home sales have declined for four consecutive months.

Abbott Laboratories, American Airlines Group, AT&T, Biogen, Capital One Financial, $D.R. Horton (DHI.US)$, Danaher, Intel, $Marsh & McLennan (MMC.US)$, Newmont,Nucor, Snap, Southwest Airlines, Twitter, and $Union Pacific (UNP.US)$hold conference calls to discuss earnings.

The Conference Board releases its Leading Economic Index for June. Consensus estimate is for a 1.1% month-over-month increase, after a 1.3% rise in May. The LEI has now surpassed its previous peak from January 2020.

The European Central Bank announces its monetary-policy decision. The central bank is widely expected to keep its key short-term interest rate unchanged at negative 0.5%. The ECB recently changed its inflation goal to 2% over the medium term instead of targeting inflation of close to, but below, 2%.

Friday 7/23

American Express, Honeywell International, $Kimberly-Clark (KMB.US)$, $NextEra Energy Partners LP (NEP.US)$, and Schlumberger report quarterly results.

Source: CNBC, Barron's

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