What to Expect in the Week Ahead (BAC, JPM, KBH and DAL Earnings; Inflation Data)

This week's macroeconomic focus is on inflation, with December's Consumer Price Index due Thursday and the Producer Price Index on Friday, against a backdrop of minimal earnings reports. Meanwhile, financial markets have moderated their expectations for early U.S. rate cuts, following initial reactions to the Federal Reserve's dovish turn in December.

Tilray Brands, Inc. is scheduled to announce its earnings for the fiscal quarter ending November 2023 on 01/09/2024, before the market opens. Zacks Investment Research reports that the consensus earnings per share (EPS) estimate, based on the analysis of 6 analysts, is -$0.05 for this quarter. This compares to an EPS of -$0.06 reported in the same quarter of the previous year.

Wall Street analysts anticipate KB Home to report a year-over-year decline in its upcoming quarterly earnings, with expectations set at $1.67 per share, a 32.4% decrease from the previous year. Revenue for the same period is projected to fall 17.1% to $1.61 billion. Notably, the consensus EPS estimate for this quarter has remained stable over the past 30 days, indicating a consensus among analysts on their revised earnings projections.

Expectations are set for JPMorgan Chase & Co. (JPM) to report a year-over-year earnings increase to $3.64 per share and a 13% revenue growth to $39.03 billion for the quarter ending December 2023. These projections are crucial for assessing the company's financial health and could significantly influence its stock price.

Market expectations for Bank of America (BAC) suggest a decline in its upcoming report, with a projected 20% decrease in earnings to $0.68 per share and a 2.2% drop in revenues to $24 billion for the quarter ending December 2023. These projections are significant for assessing the company's performance and could impact its near-term stock price.

Wall Street forecasts for Delta Air Lines (DAL) indicate a year-over-year decrease in earnings to $1.16 per share, a drop of 21.6%, despite expecting a 5.2% increase in revenues to $14.13 billion for the quarter ended December 2023. This consensus outlook is crucial for assessing the company's financial health and will play a significant role in influencing its stock price in the near term, particularly based on how actual results align with these estimates.

The December jobs report and ISM Services survey hint at potential recessionary trends in the labor market, with a notable decline in the ISM Services employment index suggesting a state weaker than the 2001 recession's worst point. Upcoming jobless claims will offer further insights. Despite these concerns, strong wage growth, influenced by recent wage settlements and minimum wage hikes, poses challenges in achieving the Fed's 2% inflation target. The slow pace of disinflation is expected to be evident in the forthcoming core CPI, while PPI data may highlight persisting supply-chain issues.

In December, producer prices are expected to have increased by 0.1% compared to the previous month, which saw no change. This slight rise is attributed to the easing of disinflationary pressures, particularly as gasoline prices only marginally declined on a seasonally adjusted basis, following previous months' decreases. Additionally, core producer prices are also anticipated to have grown by 0.1%, potentially driven by higher construction prices due to a milder winter than what is typically factored into seasonal adjustments.