Market Preview: Earnings from Cruise Lines and Steak Houses, Plus CPI on Friday


Thursday morning investors will hear earnings from Norwegian Cruise Lines (NCLH). The company preannounced a strong quarter last month, so analysts will be looking for a positive outlook from the company. Cruise industry stocks have been under pressure this year as investors fear too many ships are coming online outstripping demand. In the afternoon investors will hear from Dropbox (DBX). The storage company recently increased the storage size available to business customers without raising prices. Analysts are generally positive on the stock which went public earlier this year, spiked up 50%, and then traded back to its IPO price.

Thursday will also bring Jobless Claims which have been hovering at the lowest level seen in decades. Investors will be looking for any hint of an unexpected trend change. The Producer Price Index for July will also be released. The expectation is for a 0.3 percent increase, after increases in May and June were attributed to trade services and trade tariff expectations. Federal Reserve Bank of Chicago President Charles Evans will also be speaking Thursday morning. Fed watchers will be parsing Mr. Evan’s speech for any hint that he is moving even further into the camp that believes interest rates must rise.

The earnings calendar is relatively light on Friday, as earnings season is in its final weeks. Investors will hear from Applied Industrial Technologies (AIT) and Ruth’s Hospitality Group (RUTH). Analysts are expecting Applied to increase earnings almost 30% year-over-year. The almost 100 year old industrial supply company should give some color on general industrial health in the U.S. Ruth’s, owner of Ruth’s Chris Steak House, will also announce earnings on Friday. The stock has been on an upward trajectory for the past year. Investors will be waiting to hear of any changes from incoming CEO Cheryl Henry. Ms. Henry has been the President and Chief Operating Officer of the company, and is replacing outgoing CEO Michael P. O’Donnell.

On the economic front, Friday’s conversation will be around the Consumer Price Index numbers released Friday morning. Economists are expecting a 0.2 percent gain in July, following a 0.1 percent gain in June. The number is closely watched as a gauge of inflation, and will feed the conversation around whether the Fed is raising interest rates too quickly. The Baker-Hughes Rig Count numbers will be released at 1pm. Investors will be watching this number closely to see if the rig count is rising and if that number is high enough to slow the steady increase in the price of oil. The prior week’s numbers stood at 1,267 active rigs in North America.

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