For the first time in weeks, investors’ focus will shift away from Washington and back to Wall Street, where first quarter earnings reports will determine whether the market will continue its upward surge.
Dow Jones Industrial average member Alcoa (AA) kicks off the proceedings on Tuesday.
Analysts earlier this year had predicted a 12% decline in first-quarter profits. But economic conditions have worsened considerably, and that figure has risen to 36% according to Thomson Reuters. Make that 20%, if financial stocks are removed -- cold comfort.
Major retailers are expected to report a small increase in March same-store sales Thursday. Same-store sales likely grew 0.8% overall in March, compared with a decline of 0.7% a year earlier, according to Thomson Reuters.
If Wal-Mart (WMT), the world’s largest retailer, is taken out, same-store sales were expected to fall 3.2% for the month. Department stores are expected to report a staggering 21% drop. Discount stores, which have benefited from the recession, are likely to post a 2.6% increase.
Other companies reporting next week: housewares retailer Bed Bath & Beyond (BBBY), restaurant chain Ruby Tuesday (RT) and fertilizer company Mosaic (MOS) on Tuesday; and liquor company Constellation Brands (STZ) and discount retailer Family Dollar Stores (FDO) on Wednesday. Chevron (CVX), the second-largest U.S. oil company, will provide an interim update Thursday.
The Communications Workers of America board approved a strike by 125,000 workers in five AT&T (T) operations if new contracts are not reached before the current ones expire Saturday night. A major issue is whether workers will bear more of the cost of their health-care benefits.
The Securities and Exchange Commission will take up the issue of short selling Wednesday when the commissioners consider proposals to reinstate the uptick rule. The rule, which the SEC did away with in 2007, prevented traders from doing a short sale unless the price of the stock from the most recent trade was higher than the previous price.
On Monday, the private Conference Board issues its March employment trends index and the Chicago Federal Reserve Bank reports on regional manufacturing activity.
The government will detail February consumer credit Tuesday and February wholesale inventories Wednesday. The Federal Open Market Committee releases the minutes of its last meeting Tuesday.
The U.S. trade balance for February, to be released Thursday, is likely to be little changed from the month before. The deficit has been shrinking since last summer though it contracted sharply in November.
The markets are closed next Friday for the Good Friday holiday.
Week Ahead: All Eyes on Washington
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