NEW YORK (Dow Jones) -- Boeing Co. (BA), DuPont Co. (DD), Pfizer
Inc. (PFE) and Microsoft Corp. (MSFT) are among the major companies
posting quarterly results next week.
Meanwhile, economic reports are expected to show increases in
September housing starts and existing-home sales, while wholesale
inflation was nearly flat.
And on Thursday, Microsoft will launch its Windows 7 operating
system, which could lead to a jump in computer purchases.
Boeing, Defense Contractors Suffer In Downturn
Weakness in commercial aviation and business jets hurt aerospace
companies in the latest quarter, and defense businesses, usually
cushioned by government contracts, also have been affected somewhat
by the downturn. Defense contractors Lockheed Martin Corp. (LMT)
and Northrop Grumman Corp. (NOC) report Tuesday and Wednesday,
respectively. Boeing, a component of the Dow Jones Industrial
Average, is expected to swing to a loss Tuesday on a record $3.5
billion in charges related to its delay-plagued programs for 747-8
jets and the 787 Dreamliner.
DuPont, Dow Chemical Results Likely To Be Lower
Despite signs that business is picking up, or at least
stabilizing, major U.S. chemical makers are expected to report
double-digit percentage profit and revenue declines for the third
quarter. Dow component DuPont Co. (DD), which reports Tuesday, in
July credited government-stimulus spending and customers'
restocking for a slight uptick in business. Dow Chemical Co. (DOW),
which posts results Thursday, also forecast an upswing in
third-quarter business conditions.
Three Big Drug Makers To Post Results
After Johnson & Johnson's (JNJ) earnings report this week
showed signs of weakness in all three of its main business units,
more big drug makers are scheduled to detail their third quarters
next week. Pfizer, which reports Tuesday, expects higher earnings
on slightly lower revenue, while Merck & Co. (MRK), which
reports Thursday, is likely to post profit and revenue increases.
Both companies are involved in pending mergers expected to close
soon. Eli Lilly & Co. (LLY), reporting Wednesday, is expected
to return to the black after last year's results were hurt by legal
settlements.
Investors Await UPS Comments On Economy
United Parcel Service Inc. (UPS) posts third-quarter results
Thursday, with investors eager to see if the package-delivery giant
is more optimistic about the economy than when it issued a cautious
outlook in July. A number of players in the transport sector,
considered a bellwether of overall economic activity, have noted
improving conditions recently. Railroad CSX Corp. (CSX) predicted
the worst of the recession is over.
Mixed Results Predicted For Internet Firms
Internet companies, though not immune from the recession,
haven't been nearly as hard-hit as old-line media. Among those
reporting next week are Yahoo Inc. (YHOO), on Tuesday; eBay Inc.
(EBAY), on Wednesday; and Amazon.com Inc. (AMZN), on Thursday.
Internet portal Yahoo expects higher earnings but lower revenue.
E-retailer Amazon.com's results are seen improving, while eBay's
are likely to change little, though it seems to have righted its
core auction business.
Price Increases, Weak Dollar Aid Biotech Drug Makers
Large biotech drug makers will report third-quarter results next
week, beginning with Biogen Idec Inc. (BIIB) on Tuesday. Price
increases are expected to help drive growth and the weak dollar may
give a boost to many companies, which derive a significant portion
of revenue from overseas. Like other health-care areas, investors
are waiting to see if government-led overhaul efforts could hurt
drug prices and include legislation that will clear a path to
copycat versions of key biotech treatments. Also reporting are
Gilead Sciences Inc. (GILD) on Tuesday; Genzyme Corp. (GENZ) and
Amgen Inc. (AMGN), both Wednesday; and Celgene Corp. (CELG) on
Thursday.
Reports On Housing, Wholesale Inflation Data
Economists predict small increases in September building permits
and housing starts from the previous month, continuing the general
trend since spring. That report is due Tuesday, a day after the
National Association of Home Builders releases its October housing
market index, which reflects builders' confidence in the market.
Next Friday, the National Association of Realtors reports on
September existing-home sales, which are forecast to grow 5.5% from
a month earlier. Sales dropped in August after rising since
April.
The government will issue the September Producer Price Index,
which measures wholesale inflation, on Tuesday. Predictions are for
a 0.1% rise, after a bigger-than-expected 1.7% increase in August.
On Wednesday, the Federal Reserve will release its Beige Book,
which provides information about economic activity in various
regions. The nonprofit Conference Board's September index of
leading indicators is out Thursday.
Among appearances by Federal Reserve officials: Fed Chairman Ben
Bernanke speaks Monday in Santa Barbara, Calif., and next Friday in
Chatham, Mass.; Philadelphia Fed President Charles Plosser will
speak Tuesday in Stanford, Calif.; Boston Fed President Eric
Rosengren will speak Wednesday, Thursday and next Friday in
Chatham, Mass.; Atlanta Fed President Dennis Lockhart will speak
Thursday in Coral Gables, Fla.; New York Fed President William
Dudley will speak next Friday in Chatham, Mass.; and Fed Vice
Chairman Donald Kohn will speak next Friday in Chatham, Mass.
Microsoft's Windows 7 Goes On Sale Thursday
Microsoft launches its latest operating system, Windows 7, on
Thursday - a day before it reports fiscal first-quarter results -
and many companies are watching to see if the product will spur
consumers and businesses to buy new computers. The release has been
touted as an important driver of demand for PCs that use chips made
by Intel Corp. (INTC), Advanced Micro Devices Inc. (AMD) and other
semiconductor companies, which have suffered from a slump in demand
starting last fall. Features of Windows 7, particularly those that
allow for greater use of computer memory and enable more
touch-screen features, also could increase demand for memory-chip
firms, such as Micron Technology Inc. (MU) or Samsung Electronics
Co. (005930.SE).
Opel Sale Likely To Be Signed Next Week
The sale of German car maker Adam Opel GmbH to a consortium led
by Magna International Inc. (MGA) is expected to be signed next
week, German weekly Die Welt reported ahead of publication
Saturday, citing unnamed sources. The sale was delayed this week,
possibly because of concerns of the European Union Commission.
According to the paper, Opel's parent company, General Motors Co.,
and Magna want to wait for a reaction from competition commissioner
Neelie Kroes.
SEC To Consider Rules On 'Dark Pools'
The Securities and Exchange Commission on Wednesday will start
weighing regulations to shed more light on nonpublic trading
entities such as "dark pools," or private electronic networks that
match orders anonymously. The move is part of a broader push by the
SEC to examine market structure issues to ensure that traders all
have fair access. Already the SEC has voted to consider banning
flash trades, which allow some traders to get a sneak peak at
market activity.
Senate May Vote On Fix For Medicare Payments
The Senate is set to take up a bill as soon as next week that
would provide a 10-year, $247 billion fix to pay physicians under
Medicare, in a move that would keep the costly changes from adding
to the price tag of broader health care-overhaul legislation. The
bill would avoid steep drops scheduled in future years for
physician payments in the program.
House Panel To Vote On Consumer Agency Bill
The House Financial Services Committee is expected to vote on
legislation to create a new consumer agency and improve investor
protection next week. Committee Chairman Rep. Barney Frank,
D-Mass., said a hearing on systemic risk legislation, scheduled
Tuesday, will be pushed back a week to accommodate the other
measures.
Conferences
Among the significant conferences next week are the SRA Fall
Growth Stock Conference on Monday in New York, Bank of America
Merrill Lynch LatAm Small Cap 1-1 Conference on Tuesday and
Wednesday in New York, and New York Society of Security Analysts
Investing in Brazil Conference on Thursday in New York.
-By Kathy Shwiff, Dow Jones Newswires; 212-416-2357;
kathy.shwiff@dowjones.com
(Thomas Gryta, Bob Sechler and other Dow Jones Newswires staff
contributed to this report.)