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Ahead of Wall Street

Monday, October 17, 2016

Q3 earnings season continues to ramp up this week until it hits full strength next week and the week after. After the closing bell today we expect results from IBM (IBM - Free Report) and Netflix (NFLX - Free Report) , and Bank of America (BAC - Free Report) beat expectations on both top and bottom lines before the bell this morning.

The Charlotte, NC-based Bank of America posted 41 cents per share on $21.64 billion for Q3, easily topping the 34 cents per share and $20.8 billion expected. Equities revenue came in lower than expectations, but fixed income and investment banking revenue outperformed; total trading revenue rose 14% year over year for the Zacks Rank #2 (Buy) company.

Hasbro (HAS - Free Report) also beat estimates for both profits and sales this morning, putting up $2.03 per share on $1.68 billion, bettering the $1.74 per share and $1.57 billion. Shares of the toy-making major are up 3.65% in the pre-market.

For a comprehensive look at how Q3 earnings season is unfolding, check out Zacks Director of Research Sheraz Mian’s latest Earnings Preview report from Friday afternoon: Reassuring Start to Q3 Earnings Season

In addition to Q3 reports filing in this week, we also see some substantial economic data. The latest Industrial Production read for September came directly ahead of the opening bell this morning at 0.1%. Expectations were for 0.2% growth on the month. August was also revised down a tenth of a percent to -0.5%.
Utilizations rates, which have been trading in a tight range this year, reached 75.4% (75.6% had been expected).

 

Empire State Manufacturing fell unexpectedly far this morning, down 6.8% for October. Analysts had been expecting a 1% gain for the month. The statement for this read included that expectations are for manufacturing in New York state to pick up in coming months. Hope so!

Finally, Fed Vice Chair Stanley Fischer is scheduled to speak midday today, following Chairwoman Janet Yellen’s comments on Friday. Yellen made headlines when she said “it could make sense to run a high-pressure economy,” seemingly advocating allowing rates to remain low at the risk of heating up in a hurry.

Fischer had earlier said the September vote to raise rates at the last FOMC meeting was “a close call.” Analysts will be looking for discrepancies between Fischer’s comments today and Yellen’s last week.

Mark Vickery
Senior Editor

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