Preparing For A Post-Sandy Wall Street

With Hurricane Sandy still battering parts of the
Mid-Atlantic and an estimated $10 billion to $20 billion in economic
damage
across the East Coast, many of us still aren’t out of the water yet.
But while
first responders and public officials are working around the clock to
protect
people in the affected areas, Wall Street is making arrangements to
reopen as
usual tomorrow morning. As Wednesday just so happens to be the last
trading day
of the month, it should be a busy day as institutional investors
scramble to rebalance
their portfolios for the month.

For those of you who can, now is a good time to
prepare for
tomorrow’s trading action, so I want to take a moment to run down the
big
earnings and economic events to look for tomorrow and beyond.

On Halloween, we’ll receive earnings data from
several big
household names:

  • Spirit
    Airlines Inc.
    (SAVE) reports first thing in the morning.
    While SAVE is headed towards 19.3% sales growth, analysts also forecast
    a 10.3%
    dip in earnings. SAVE
    is a hold
    .
  • The
    Clorox Co.
    (CLX) also announces before market open. As
    I mentioned in a recent Stock of the Day feature
    , I’m not convinced
    that
    this earnings announcement will blow estimates out of the water. CLX
    is a cautious buy
    .
  • Credit card giant Visa
    Inc.
    (V) reports after the closing bell. Analysts expect 12.2%
    sales growth and 18.1% earnings growth. V
    is also a cautious buy
    .
  • Allstate
    Corp.
    (ALL) wraps things up after close with its third-quarter
    earnings
    announcement. While Allstate is headed towards single-digit sales
    growth, its
    bottom line is expected to surge 606% (compared with the -99% industry
    average). ALL
    is a strong buy
    .

Along with the weekly jobless claims, the
September
construction spending and the October consumer confidence reports,
Thursday
will bring quarterly results from these consumer and retail companies:

  • Body
    Central Corp.
    (BODY) reports earnings before Thursday’s open.
    BODY
    is
    headed towards just 3% sales growth and an 84% plunge in profits. BODY
    is a sell
    .
  • Kellogg
    Co.
    (K) announces earnings before open. Kellogg is due to report
    double-digit sales growth but flat earnings. K
    is a hold
    .
  • Bebe
    Stores Inc.
    (BEBE) is up to announce earnings sometime during
    the
    day. This
    should be a particularly weak report–analysts forecast a 9% drop in
    sales and a
    200% plunge in profits. BEBE
    is a strong sell
    .
  • High end grocer Harris
    Teeter Supermarkets Inc.
    (HTSI) finishes out the day. This
    company’s sales are expected to growth 7% and its earnings by
    17%–beneath the
    20% industry average. HTSI
    is a sell
    .

Then Friday will be relatively quiet on the
earnings front,
but it’s the day that the Labor Department releases the unemployment
report for
October. I consider this to be the most important report for the week.

This Labor Department announcement consists of two
separate
reports. First, about 60,000 households are surveyed to determine the
unemployment rate. Currently, economists
expect a 7.9% unemployment rate, slightly higher than September’s 7.8%
rate.

Then, approximately 375,000 businesses are
surveyed to
determine the number of nonfarm payrolls, average workweek and average
hourly
earnings figure. As it stands, the consensus calls for 135,000 nonfarm
payrolls
(over 114,000 last month), a 0.2% increase in hourly earnings, and for
the
average workweek to remain unchanged at 34.5 hours.

In the meantime, I’ll check in first thing
tomorrow with a
report on trading activity and anything else you may need to act on
once the
stock market reopens.

Until then,

Louis Navellier

Louis Navellier

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