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Retailer Results May Indicate Consumer Spending Potential
15 November 2010 - News - EditorStock market investors will no doubt be keen to see third quarter results from US retailers Wallmart, Target, Nordstrom and Saks which are due to be released in this week. With Target and Wal-Mart dominating the discount sector of retail shopping, and Saks and Nordstrom representative of higher-end consumers, third quarter results may be indicative of what can be expected of US consumers throughout the economic spectrum for the upcoming festive season. Black Friday - so-called because it pulls many retailers out of the red and into the black financially - is a mere two weeks away and investors will want to be part of the action if consumers are going to keep up the spending-spree tradition set for this day. With the recent jobs report indicating that there has been an improvement in hiring, many are hopeful that more consumer dollars will be spent over the festive season.
Monday on Wall Street kicks off with the October retail sales report from the Commerce Department in which economist have predicted a 0.7 percent increase following September's increase of 0.6 percent. It is anticipated that Lowe's will report earnings of 30 cents per share as compared to 24 cents per share this time last year. Monday ends with an after close release of Nordstrom's third quarter results. Tuesday sees the release of third quarter results from Wal-Mart, Home Depot, Saks Incorporated, and Abercrombie & Fitch. Other information expected on Tuesday includes the Producer Price Index (PPI) from the Commerce Department, plus the core-PPI which excludes food and energy prices which are considered to be volatile. The National Association of Homebuilders releases its October housing market index after the opening bell on Tuesday.
The US Commerce Department will release the Consumer Price Index (CPI) in the morning. This measure of consumer inflation is expected to have climbed by 0.3 percent in October, while the core-CPI is likely to have increased by 0.1 percent. Third quarter results are expected from Target and Applied Materials – both Fortune 500 components. While there has been some improvement on hiring as noted earlier, the jobless claims report from the Department of Labor, due on Thursday, is expected to have climbed from 435,000 to 442,000; with continuing claims remaining at around 4.3 million. Dell is set to release its third quarter result after the closing bell on Thursday, with expectations being that its share price will have climbed to 32 cents as compared to the share price of 23 cents posted this time last year. No market-moving data is expected on Friday, but stock market players will have had plenty to deal with by then and may welcome the break.
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