President Barack Obama is expected to sign a $787 billion
economic stimulus bill designed to shore up the flagging economy
and stem job losses after votes in the House and Senate Friday.
Major retailers, including Wal-Mart Stores Inc. (WMT), will post
quarterly results next week, with the reports illustrating one of
their roughest periods on record.
Meanwhile, General Motors Corp. (GM) and Chrysler LLC are
scheduled to submit plans demonstrating their viability as part of
the federal loan agreements with the auto makers.
Stimulus Bill Headed To President
A broad $787 billion economic stimulus bill was expected to gain
House and Senate approval Friday, then go to the president for his
signature. The compromise between House and Senate bills was
hammered out at breakneck speed during the past several days to
meet Obama's request that the bill be on his desk by the Presidents
Day holiday on Monday.
The bill includes a package of tax cuts worth $287 billion, some
$27 billion to modernize roads and bridges and $87 billion in
outlays during the next two years to help states provide Medicaid
coverage. The bill will funnel more than $40 billion into clean
energy and efficiency programs.
Retailers' 4Q Results Won't Be Pretty
All seven of the retail groups in the Standard & Poor's 500
Index are projected to see their earnings fall in the latest
quarter from a year earlier, according to Thomson Reuters. Most
retailers' quarters closed at the end of January, meaning the
period will reflect consumer scarcity in November, deep discounts
in December and continued apathy and low gift-card redemptions last
month.
Home-improvement retailers such as Lowe's Cos. (LOW) are likely
to see the biggest tumble, followed by department stores, such as
J.C. Penney Co. (JCP). Both companies report Friday. Wal-Mart,
considered a consumer-staples company because of its large
supermarket business, is expected to post a 5% decline in earnings
Tuesday.
Hewlett-Packard 1Q Results Likely To Be Up
Tech giant Hewlett-Packard Co. (HPQ) is expected to report
higher fiscal first-quarter results Wednesday, according to a poll
by Thomson Reuters. The company, considered a bellwether because of
its broad product portfolio that includes both computer-related
hardware and tech services, has set aggressive goals for this year
despite the global economic slowdown.
Deere Expected To Cut 2009 Guidance
Deere & Co. (DE), the world's largest manufacturer of farm
equipment, will report fiscal first-quarter results Wednesday. The
company is widely expected to trim its 2009 net income forecast of
$1.9 billion, or $4.50 a share, following lower demand for farm and
construction machinery reported earlier by rivals CNH Global NV
(CNH) and Agco Corp. (AG).
G7 Finance Ministers, Bank Chiefs Meet
Finance ministers and central bank chiefs from the Group of
Seven leading industrial economies are meeting through the weekend
in Rome. U.S. Treasury Secretary Timothy Geithner plans to
encourage them to take bold, extraordinary steps to ease the pain
in global financial markets.
Markets Closed Monday For Presidents Day
U.S. stock markets - as well as banks, governments and many
businesses - will be closed Monday for the Presidents Day
holiday.
Later in the week, the government releases reports on wholesale
and retail inflation, with the producer price index out Thursday
and consumer price index on Friday. Both are likely to show few
signs of inflation last month.
A Wednesday report on housing starts is expected to show another
decline in January, the seventh month in a row, bringing
construction to a new low. A day earlier, the National Association
of Home Builders issues its February housing market index, a survey
of builders' thoughts on market prospects. The January index marked
a new low.
The government reports on January industrial production
Wednesday, and the private Conference Board releases its January
leading indicators index a day later. Reports on regional
manufacturing activity are due Tuesday from the New York Federal
Reserve and Thursday from the Philadelphia Fed.
GM, Chrysler Plans Due Tuesday
Executives at General Motors and Chrysler are racing to pull
together the final pieces of their viability plans that must be
submitted to the Treasury Department on Tuesday. The Detroit auto
makers are required to submit a plan if they want to access more
low-interest loans to keep their operations running during the
worst sales downturns in decades.
GM expects to receive the final $4 billion of its $13.4 billion
federal loan package Tuesday. GM and Chrysler in December were
granted as much as $17.5 billion in emergency loans from the
Treasury. Chrysler has received $4 billion and is seeking $3
billion more.
Some Local Stations To Switch Anyway
Although Congress approved delaying the mandatory switch to
digital-only television to June 12, local stations can switch
earlier. About 40% want to do that on the original deadline,
Thursday, hoping to save thousands of dollars they would have to
pay to continue broadcasting in both analog and digital for a few
more months. At the Federal Communications Commission, officials
are considering denying some stations' requests so communities
won't be left without at least one local channel still broadcasting
in analog.
Designers To Avoid Trendy At NYC Fashion Week
At New York City's Fashion Week, which starts Friday and
continues through Feb. 20, the styles for next fall are some of the
first work to be designed since consumer spending fell off a cliff
last autumn. Expect to see a mix of spunky and dour on the runways.
Some designers are likely to be upbeat and embellished, while
others focus on a mix of practical day-into-night looks and others
that play on consumers' emotions.
After massive discounting, even of luxury goods, by some major
department stores starting in November, some designers are
considering offering retailers only their "pre-fall" collection,
but not what they show on the runways, which would appear only in
their own shops, according to one buyer.
Toy Fair Opens Sunday In New York
Thousands of manufacturers, retailers, importers and licensers
will be in New York for the annual American International Toy Fair,
starting Sunday. It is the largest international toy trade show in
the Western Hemisphere. Among the highlights, the launch of a
Bernie Madoff action figure and celebrating Barbie's 50th
birthday.
Mobile World Congress Starts Monday
Attendance is likely to dip this year at the Mobile World
Congress, which opens Monday in Barcelona, although the sector is
proving more resilient than most to the economic downturn.
Companies are focused on cost-cutting, rather than growth, but the
Android will again be a hot topic as software and user experience
start to trump hardware. Support for the open operating system,
launched by Google Inc. (GOOG) more than a year ago, has gathered
pace in recent months.
Conferences
Among the significant conferences next week are the Roth Capital
Partners Annual OC Growth Stock Conference from Monday through
Thursday in Laguna Niguel, Calif.; Consumer Analyst Group of New
York Conference from Monday through Friday in Boca Raton, Fla.;
Morgan Stanley Global Basic Materials Conference on Tuesday and
Wednesday in New York; and Piper Jaffray Clean Technology and
Renewables Conference on Thursday in New York.
-By Kathy Shwiff, Dow Jones Newswires; 201-938-5975;
kathy.shwiff@dowjones.com
(Robert Tita and other Dow Jones Newswires staff contributed to
this report.)