VIDEO: Earnings From These 3 Holdings Could Shape the Week

We are kicking off this week in today’s Daily Rundown with Chris Versace sharing our roadmap of events that could influence the market and the Portfolio. 

Chris touches on weekend tariff moves by President Trump and discusses the earnings reports we will be following this week, including the ones from Portfolio holdings Bank of America BAC, Morgan Stanley MS and American Express AXP. He also explains why the June inflation reports, out on Tuesday and Wednesday, could weigh on the market. 

Transcript

CHRIS VERSACE: Hey, everyone, Chris Versace here. It is Monday, July 14, my friends. We are halfway through the month of July. And despite last week's weak finish, that as you know, was spurred on by renewed Trump trade uncertainty, so far the market is in positive territory. But that could change today as the market has to contend with what happened over the weekend. I'm of course, referring to President Trump pressing trade uncertainty even higher, disclosing potential 30% tariffs on the eurozone and Mexico starting August 1 if they can't come to a trade deal with the US.

Now, in Friday's Weekly Roundup, you probably noticed that we continued to talk about our concerns about what the new bout of tariffs and trade uncertainty could mean for the upcoming earnings season and corporate guidance. Trump's actions over the weekend only add to that view. Now, as it relates to today, odds are those weekend developments are going to be the primary driver of the market, folks asking questions, trying to figure out what may or may not happen as we get ready for the June quarter earnings season to kick into a higher gear starting later this week.

But today, because we don't have any earnings reports, because we don't have any real fresh economic data coming out, it is going to be the market's thinking about this renewed trade uncertainty that is really going to weigh on the market today. Will we be following comments from the White House during the day? Of course, we will. Will we be following comments from the European Union, from Mexico, and others that have received these Trump tariff letters, yes.

Again, we think there's going to be kind of a mad scramble to this potential August 1 date, but we're going to have to take it day-by-day following what happens and assessing any new developments that may happen. Maybe there's a trade deal, maybe there's not. Maybe there are some reciprocal tariffs that are announced. Kind of what Brazil was saying that they could do. We'll have to take it step-by-step.

But I can share with you this, that when we put today and whatever it brings behind us, we do have a big week of economic data coming that includes two pieces of inflation data that could very well lead the market to once again question the timing of potential Fed rate cuts later this year. Remember, we've already seen the June ISM data and what it showed for inflation both for manufacturing and for services. So while we may not be surprised what the June CPI and PPI reports bring later this week, there may be others out there that aren't paying attention to all the data like we are, and they could be surprised when they see those June, again, core CPI and PPI figures.

Now, again, today, not much. But we will be watching for pre-earnings announcements and what they could mean. Now, let's talk about the rest of the week because again, it's going to be busy.

Tuesday, Albertsons is going to report coming off of what Kroger had to say about the impact of tariffs on their business and the lowering of their same store sales forecast for the fiscal year. We want to pay attention to what Albertsons has to say, yes, on tariffs, but also too, what are they seeing about consumer spending. Tuesday also has quarterly results from Ericsson. We'll be zeroing in on what they say about digital infrastructure spending.

But we also have Citigroup, JP Morgan and Wells Fargo reporting. Now, these are going to set the tone for what we should be hearing from Morgan Stanley and Bank of America on Wednesday. So what will we be paying attention to when Citigroup, JP Morgan, Wells Fargo report? What are they saying about investment banking, particularly their pipeline? And do they give us any specific color on the IPO market, the advisory market, the M&A market?

We're expecting that they're going to say that their pipelines are robust. But we'll want to confirm that. We'll also want to hear what they have to say about commercial banking, about consumer spending, credit card debt, and of course, trading volumes. And again, that's going to set the stage for Bank of America and Morgan Stanley. Tuesday, as I mentioned, we also have the June CPI report. And yes, expectations are for it to tick higher.

The question will be, is it higher than the market expects? And if it is, that probably won't be viewed very favorably. Wednesday, Morgan Stanley, Bank of America, again, talked quite a bit about that. We will be revisiting our price targets. We do expect both to have very upbeat reports. But again, we really want to pay close attention to what they say about their investment banking pipelines. We also have quarterly results on Wednesday from ASML.

It should give us some interesting color on the semiconductor capital equipment market. Quarterly results from Goldman Sachs, that will round out the big bank picture. And then we have United Airlines. Here, we'll be looking to see if they mimic what Delta Airlines had to say about expecting a softer domestic travel market, but international and higher end travel remaining strong.

We'll be thinking about that as it relates to American Express earnings, which we'll be getting on Friday. Wednesday also brings the June PPI report. And here too, the expectations are that it will tick higher. Again, the question that we have to focus on is to what degree is it higher than expected? Because if it is, if it's much hotter, that's going to again rekindle the notion for the market to reexamine the timing for potential Fed rate cuts later this year.

Complementing the June PPI report on Wednesday afternoon, we'll also get the next iteration of the Fed Beige Book. When we flip through that, we'll be the usual, right? What's the speed of the economy? What does it say about inflation? What does it say about job creation?

That will bring us to Thursday. Probably the most important earnings report out Thursday morning is going to be the one from Taiwan Semiconductor. Now, we know that the company's revenue is up significantly on a year-over-year basis, up low double digits on a quarter-over-quarter basis. But when we dig into this report, there's going to be a couple of things that we're looking for.

First one, what is the end market commentary between connected devices and high performance computing? Remember, high performance computing, AI and data center. And that should be very strong. Second, when the company gives its guidance, we will want to hear what they have to say, again, by its particular end markets. And we'll translate all that into what we're likely to hear in the coming weeks from the likes of NVIDIA, Marvell, Apple, Universal Display, and Qualcomm.

After the market close on Thursday, Netflix is going to report this is in the bullpen, so we'll be paying close attention to it. We'll really be paying close attention to what they say on the advertising front and the content slate, because content is king. And if they have a robust pipeline, including the final season of Stranger Things, that could turn some ears.

Also, on Thursday, in the morning, we will be getting the retail sales report. And as you know, we like to size that up for Costco. But we'll also be paying close attention to it for what it has to say about overall consumer spending and tying that back to American Express. And that brings me to Friday, when American Express will report.

Remember, we continue to like the membership business model there. Do we think they're going to say much about the upcoming platinum card refresh? I would be surprised that they do it on the earnings call. I think, though, the membership fee income is really going to allow this report to stand out against others that we will be getting, in particular MasterCard and Visa. So a little compare and contrast down the road, but I think it will be very good for American Express.

Friday morning we also have 3M reporting. We'll be taking a look at that for the industrial and manufacturing economy, tying that back to what they say about tariffs and demand and pricing pressure. Friday morning, we also have the June housing start report. Candidly, not expecting a knock your socks off print just given where we've seen mortgage rates move. But we'll read it. We'll keep an open mind with a focus on single family housing construction and what that may or may not tell us about Vulcan Materials, United Rentals, and to a lesser extent, Waste Management.

Remember, the key, especially for Vulcan Materials, Waste Management is non-residential construction, which, of course, data center construction is a nice driver and a nice tailwind for that. Now, that's the week. But as we move through it, we will be connecting the dots as we collect them from the economic data and earnings as it relates to the economy, the market, and the portfolio. And as you could probably tell, it's going to be a much busier week than the last few, and it's going to be important for you to check your alerts throughout the week, especially if we make any moves with the portfolio.

Last week, as you know, we made a few. And it is possible that there could be a few more moves to be made in the coming days. Also this week, I'll be back in New York doing some videos with Schwab and Yahoo Finance and some others. And yes, we will be sharing those videos with you, but I just want to give you the heads up that because of the travel, there will not be office hours this week. Our next set of office hours will be on Monday, July 21.

So that's today's video. We're going to have a lot more content coming your way not only today, but throughout the week. So again, be sure to check your emails, your alerts. We want to make sure you're getting our latest thoughts. And as I hinted, if we do make any moves with the portfolio, we want to make sure that you are right there with us. Thanks for watching.

At the time of publication, TheStreet Pro Portfolio was long BAC, MS and AXP.