What to Watch in the Day Ahead - Thursday, Aug 31

Sovos Brands

30/08/2023 19:34

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Investors are eagerly anticipating the release of the U.S. personal consumption expenditures
(PCE) price index as it could provide further insights into the direction of interest rates. The
index likely increased 0.2% in July, after edging up 0.2% in June. In the 12 months through
July, the PCE price index possibly advanced 3.3%. Excluding the volatile food and energy
components, the PCE price index likely to have gained 0.2% in July, after rising 0.2% in the
prior month. The so-called core PCE price index is expected to rise 4.2% on a year-on-year basis
in July. Meanwhile, consumer spending, which accounts for more than two-thirds of U.S. economic
activity, possibly increased 0.7% in July, after gaining 0.5% in June. Personal income likely
climbed 0.3% in July, after rising 0.3% in the month before. Separately, the U.S. Labor
Department's weekly report is expected to show initial claims for state unemployment benefits
likely increased by 5,000 to a seasonally adjusted 235,000 for the week ended Aug. 26. The
number of people receiving benefits after an initial week of aid possibly increased by 1,000 to
1.703 million in the week ended Aug. 19.

Broadcom Inc is expected to report a rise in third-quarter revenue as the chipmaker benefits
from the artificial intelligence boom.

Dollar General Corp is likely to post a rise in second-quarter revenue as customers, pinched by
still-high inflation, opt for cheaper groceries, apparel and party supplies. Investors will be
looking out for margin impact from spending shift to essential goods, retail shrink and comments
on near-term U.S. demand.
    
Atlanta Fed's President Raphael Bostic is scheduled to make prepared remarks and participate in
a panel discussion at the South African Reserve Bank's Biennial Research Conference at Cape
Town, South Africa. (0315/0715) Boston Fed President Susan Collins is likely to speak virtually
on creating an economy that works for all and the role community colleges play in the nation's
essential development of its people and workforce before the Bunker Hill Community College
annual convocation at Boston, Massachusetts. (0900/1300)

Personal computer-maker Dell Technologies Inc is scheduled to post second-quarter revenue above
estimates as easing inflation contributes to recovering demand for computer hardware.

Campbell Soup Co is scheduled to post a rise in fourth-quarter sales, as higher prices help
offset weak demand at a time when consumers are trading down to cheaper food brands. Investors
will be focused on the company's forecast, its comments on demand trends, private-label
competition, margins and details around its $2.7 billion deal to buy Sovos Brands.

Hormel Foods Corp is expected to post a marginal rise in third-quarter revenue on resilient
demand for its packaged meat and food products, with consumers preferring cheaper home-cooked
meals over dining out. Investors will seek comments on inventory levels, costs of raw material
and promotional strategies.

On the Canadian economic schedule, Statistics Canada is expected to report that the country's
current account deficit likely widened to C$11.20 billion in the second quarter from a C$6.17
billion deficit in the first quarter.

Lululemon Athletica Inc is expected to post a rise in second-quarter revenue, helped by
resilient demand for its pricey activewear from affluent Americans. Investors will look out for
comments on demand trends in North America and China, cost-control initiatives, inventory
management and any forecast that the company provides.

A flurry of data can also be expected from the Latin American economic front. Brazil's central
bank is expected to release budget balance data and debt-to-GDP ratio for July. The country's
unemployment rate is also scheduled for release. The jobless rate is expected to rise 7.9% in
the three months through July, down from 8.0% the month before. Meanwhile, Mexico's unemployment
rate likely grew to 2.8% in July. Separately, in the 12 month through July, Chile's
manufacturing output likely fell 3.2%.


 (Compiled by Sandhra Sam in Bengaluru; Edited by Shilpi Majumdar)
 ((SandhraMariam.Sam@thomsonreuters.com;))