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Friday, July 10, 2009
Week Ahead: An Earnings Downpour
By Dunstan Prial
FOXBusiness
Second-quarter results will heat up next week as investors scour reports from an array of bellwether companies looking for signs that the economy is rebounding.
A handful of the biggest U.S. banks will report and the results are expected to be markedly better than six months ago, when the financial system seemed on the edge of a precipice.
Goldman Sachs (GS), once a Wall Street investment bank and now a bank-holding company, reports Tuesday and is expected to post a profit of $3.42 a share, down from $4.58 a share a year earlier.
As competition has grown scarce with the disappearance of such giants as Bear Stearns and Lehman Brothers, the big banks still standing will likely benefit from increased fees that will help them offset losses from bad loans.
JPMorgan Chase (JPM) reports on Thursday, and both Citigroup (C) and Bank of America (BAC) on Friday.
Chip maker Intel (INTC), a bellwether of the technology sector, is expected to post significantly lower second-quarter results Tuesday, underscoring how the broad economic slump is weighing down the chip industry.
International Business Machines (IBM) and Google (GOOG), which report Thursday, are expected to post higher earnings from a year earlier.
Big Pharma continues to face sales pressure from generic competition, the weak economy, increased scrutiny of drug safety and difficulties bringing new products to market.
Health-care giant Johnson & Johnson (JNJ) reports results Tuesday, followed by Abbott Laboratories (ABT) on Wednesday.
General Electric (GE) reports second-quarter results next Friday, with concerns rampant regarding proposed new financial regulations that some observers say eventually could push the conglomerate to spin off its big finance arm, GE Capital.
AMR Corp. (AMR), parent of American
Airlines, is expected to report a narrower second-quarter loss Wednesday.
Harley-Davidson (HOG) is expected to report
second-quarter per-share earnings of 25 cents on revenue of $1.18 billion, down from 95 cents and $1.57 billion a year earlier.
High drama is expected when former Treasury Secretary Henry Paulson testifies Thursday before Congress on the government's role in Bank of America’s acquisition of Merrill Lynch. Paulson's testimony will mark the third in a series of high-profile hearings held by the House Committee on Oversight and Government Reform.
There are lots of economic reports next week, as well.
The Producer Price Index, out Tuesday, is expected to climb 0.8%, compared with 0.2% in May, and the Consumer Price Index, out Wednesday, is seen up 0.6%, compared with 0.1% last month.
The government also reports on June retail sales Tuesday and industrial production Wednesday.
A government report Friday is expected to show lower housing starts in June but an increase in building permits. The National Association of Home Builders issues its July housing market index Thursday.
Regional manufacturing reports will be released by the New York Fed on Wednesday and Philadelphia Fed on Thursday. The Federal Reserve issues minutes from its June meeting on interest rates Wednesday.
Meanwhile, the Senate Judiciary Committee will start its confirmation hearing Monday for President Barack Obama's Supreme Court pick, Judge Sonia Sotomayor. Her nomination is expected to meet tepid opposition from badly outnumbered Republicans.
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