Wall Street: Plan for a storm

A six-week advance meets the first big week of corporate results, with 140 major companies due to open their books.

EMAIL  |   PRINT  |   SHARE  |   RSS
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
By Alexandra Twin, CNNMoney.com senior writer

10 biggest CEO paychecks
Including salary, bonuses, stock and options, these public company CEOs took home pay packages last year worth up to $104 million.
If you were a venture capitalist, which field would you invest in this year?
  • Green energy
  • Consumer products
  • IT
  • Financial services
  • Medical technology and pharmaceuticals
  • Nothing; I'd hoard my cash until the economy improves

NEW YORK (CNNMoney.com) -- As the profit reporting period moves into its busiest two weeks, investors have reason to be a bit more optimistic.

The S&P 500 rose 28.5% in a six-weeks-and-counting advance, after a selloff that left the broad index at a 12-1/2 year low. Bets that the economy and financial sector are close to stabilizing helped fuel the run, enabling investors to shed some of their worst-case scenarios.

"During the previous three months I was getting panicked calls from investors about the end of the world," said Jamie Cox, managing partner at Harris Financial Group. "Now those same people are saying 'we need to get in now before we miss it.'"

Supporting the optimism over the last week has been a rash of not-as-bad-as-expected quarterly results from bellwether companies.

First-quarter so far: With roughly 10% of the S&P 500 having reported results so far, profits are on track to have shrunk 37.4% from a year ago, according to the latest from Thomson Reuters.

The S&P 500 is on track to post its seventh consecutive quarter of shrinking profits, the longest stretch since Thomson began tracking results in 1998.

Although it's too early to discern the broad trend, "so far we're seeing some bright spots in the financials, relative to expectations," said John Butters, senior research analyst at Thomson Reuters.

Last week, JPMorgan Chase (JPM, Fortune 500), Goldman Sachs (GS, Fortune 500) and Citigroup (C, Fortune 500) all reported results that fell from a year ago but topped estimates. Earlier in the month, Wells Fargo (WFC, Fortune 500) forecast a bigger-than-expected quarterly profit.

Nonetheless, financial sector earnings are still expected to post declines this quarter, Butters said, with current forecasts for a drop of 37%.

All ten economic sectors tracked by Thomson are expected to post declines this quarter. That list is led by the consumer discretionary sector, which is expected to see profits drop by 113% from a year ago.

The least-bad sector is healthcare, which is expected to post a 2% drop in profits versus a year ago.

Big companies due to report results this week include Bank of America (BAC, Fortune 500), American Express (AXP, Fortune 500), Microsoft (MSFT, Fortune 500), Yahoo (YHOO, Fortune 500), IBM (IBM, Fortune 500) and Apple (AAPL, Fortune 500).


Around 140 companies, or 28% of the S&P 500 report results this week. Here are some of the highlights.

Monday: Bank of America reports quarterly results before the start of trading. The Dow component is expected to have earned 5 cents per share versus 23 cents a year ago.

After the close of trade, IBM is expected to report earnings of $1.66 per share, versus $1.65 a year ago.

Other companies due to report Monday include Eli Lilly (LLY, Fortune 500), Halliburton (HAL, Fortune 500) and Texas Instruments (TXN, Fortune 500).

Tuesday: Dow components Caterpillar (CAT, Fortune 500), Coca-Cola (KO, Fortune 500), Merck (MRK, Fortune 500) and United Technologies (UTX, Fortune 500) are all expected to report results before the start of trading. All are expected to report lower quarterly earnings versus a year ago.

After the close, Yahoo is expected to report earnings of 8 cents per share versus 11 cents a year ago.

Other companies due to report Tuesday include Delta Air Lines (DAL, Fortune 500), Lockheed Martin (LMT, Fortune 500), Schering-Plough (SGP, Fortune 500) and Advanced Micro Devices (AMD, Fortune 500).

Wednesday: Wells Fargo is expected to report results before the start of trading. The company forecast a week ago that it will see a profit of around $3 billion. Analysts expect earnings of 41 cents per share versus 60 cents a year ago.

Financial firm Morgan Stanley (MS, Fortune 500) is expected to report results before the start of trading. The company is expected to report a loss of 9 cents per share versus a profit of $1.45 a year ago.

Also in the morning, Dow components AT&T (T, Fortune 500), Boeing (BA, Fortune 500) and McDonald's (MCD, Fortune 500) are due to report results.

Apple releases results after the close of trading. Apple is expected to have earned $1.09 versus $1.16 a year ago.

Thursday: Microsoft reports results after the close. The software leader is expected to report a profit of 39 cents per share versus 47 cents a year ago.

Also after the close, Amazon.com (AMZN, Fortune 500) is expected to report earnings of 31 cents per share versus 34 cents a year ago.

UPS (UPS, Fortune 500), PepsiCo (PEP, Fortune 500), Raytheon (RTN, Fortune 500) and Amgen (AMGN, Fortune 500) are among the other companies due to report results Thursday.

Friday: Dow component 3M (MMM, Fortune 500) is due to report results before the start of trade. 3M is expected to have earned 86 cents versus $1.38 a year ago.

Honeywell (HON, Fortune 500), Schlumberger (SLB) and Xerox (XRX, Fortune 500) are among the other companies due to report quarterly results in the morning.


In a light week for economic news, standouts include the index of leading economic indicators and reports on new and existing home sales. All forecasts represent a consensus of economists surveyed by Briefing.com.

Monday: The March index of leading economic indicators (LEI) is due shortly after the start of trading. LEI, released by the Conference Board, is expected to have fallen 0.2% in the month after falling 0.4% in the previous month.

Tuesday: A House of Representative subcommittee holds a hearing on Treasury's plan for toxic assets.

Thursday: The number of Americans filing new weekly unemployment claims is expected to have risen to 630,000 from 610,000 the previous week. The Labor Department report is due before the start of trading. Investors will also focus on continuing claims - a measure of people receiving benefits for a week or more. Last week, continuing claims surged to a record 6.02 million.

Shortly after the market open, the National Association of Realtors releases the March existing home sales report. The February report showed a surprise rise and investors will be looking to see if the trend continues. Sales are expected to fall to a 4.65 million unit annual rate from a 4.72 million unit annual rate in the previous month.

Friday: The Commerce Department releases the March durable goods orders report before the start of trading. Orders are expected to have fallen 1.5% after falling 5.1% in the previous month.

The Census Bureau releases the March new home sales report shortly after the market open. Sales are expected to have rise to a 340,000 annual unit rate in the month from a 337,000 unit annual rate in the previous month. The February figure rose unexpectedly from the previous month. To top of page

They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
10 of the most luxurious airline amenity kits When it comes to in-flight pampering, the amenity kits offered by these 10 airlines are the ultimate in luxury More
7 startups that want to improve your mental health From a text therapy platform to apps that push you reminders to breathe, these self-care startups offer help on a daily basis or in times of need. More
5 radical technologies that will change how you get to work From Uber's flying cars to the Hyperloop, these are some of the neatest transportation concepts in the works today. More
Worry about the hackers you don't know 
Crime syndicates and government organizations pose a much greater cyber threat than renegade hacker groups like Anonymous. Play
GE CEO: Bringing jobs back to the U.S. 
Jeff Immelt says the U.S. is a cost competitive market for advanced manufacturing and that GE is bringing jobs back from Mexico. Play
Hamster wheel and wedgie-powered transit 
Red Bull Creation challenges hackers and engineers to invent new modes of transportation. Play

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.