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| | Welcome to the Sunday edition of Wall Street Breakfast, which previews events for investors to watch during the upcoming week. If you want to receive this a day earlier, follow Stocks to Watch and select the option to receive email notifications. Top News  The latest update on inflation in the U.S. will drop on the lap of investors, with June CPI report scheduled to be released on Wednesday. Economists forecast headline inflation to fall to 3.0% from 4.0% in May and core inflation to be reported at 5.0% from 5.3% in May. A CPI surprise could reset expectations on the direction of the Federal Reserve. At publication time, traders were pricing in a 90% probability that the Federal Reserve will raise rates by 25 basis points at the meeting later July 25-26. The earnings season kicks off with major banks JPMorgan Chase ( JPM), Wells Fargo ( WFC), and Citigroup ( C), some of the heavyweights stepping into the earnings confessional. The readout on what major banks say about deposit flows and loan growth is also anticipated to have an impact on regional banks' stocks. Some analysts have warned that large banks' earnings have peaked as net interest income is likely to continue to decline, credit costs are gradually normalizing and increasing, and expenses are pressured by inflation. EPS growth is also being hurt as banks position for likely regulatory changes by adding liquidity, increasing debt capital, and several holding back on share repurchases. Outside the banking sector, companies due to spill numbers include Delta Air Lines ( DAL) ( preview), UnitedHealth Group ( UNH) ( analysis), and PepsiCo (NASDAQ: PEP) ( analysis). Looking at the earnings season as a whole, there have been 62 negative EPS preannouncements issued by S&P 500 corporations compared to 39 positive, which London Stock Exchange Group computes is an N/P ratio of 1.6 for the S&P 500 Index. This compares to a long-term average of 2.5 and prior four-quarter average of 2.0. | | Earnings Earnings spotlight: Monday, July 10 - Helen of Troy (HELE), WD-40 Company (WDFC), and PriceSmart (PSMT).
Earnings spotlight: Tuesday, July 11 - Byrna Technologies (BYRN).
Earnings spotlight: Wednesday, July 12 - MillerKnoll (MLKN) and AngioDynamics (ANGO).
Earnings spotlight: Thursday, July 13 - PepsiCo (PEP), Delta Air Lines (DAL), and Conagra Brands (CAG). Seeking Alpha analyst Dilantha De Silva highlighted key areas to focus on ahead of DAL's Q2 earnings report.
Earnings spotlight: Friday, July 14 - UnitedHealth Group (UNH), JPMorgan Chase (JPM), Wells Fargo (WFC), State Street (STT), BlackRock (BLK), and Citigroup (C). Seeking Alpha analyst JR Research noted that Citigroup stock is still undervalued relative to its financial sector peers. | | IPOs IPO and spinoff watch: No new offerings are expected to be priced next week as the IPO market cools off from what was a burst of activity in June when five IPOs raised $1.3B in aggregate proceeds to mark the most active month for IPOs since May 2022 when $1.1B in proceeds was raised. CAVA Group (NYSE: CAVA), which had the splashiest debut of the bunch, will have its quiet period expire on July 10 to open up analysts to post ratings. The quiet period also ends on Azitra (NYSE: AZTR) and BranchOut Food (NASDAQ: BOF), which are both down from their IPO pricing levels. Skyward Specialty Insurance Group (NASDAQ: SKWD) and MGO Global (NASDAQ: MGOL) are also on watch with blocks of shares coming off their IPO lockup expiration. | | | | | Events Corporate events: Daimler Truck (OTCPK:DTRUY) will hold its first Capital Markets Day as a standalone company on July 11. Deutsche Bank expects the German trucking giant to provide a tech update that includes profitability indicators for diesel versus electric trucks as well as a roadmap until 2030. An announcement of a buyback plan is seen as a potential share price catalyst. Sprinklr (CXM) will hold an Investor Day event on July 12, with top executives expected to provide an overview of the company's market opportunities, new product innovations, various use cases, and Sprinklr's financial outlook. Notable events in the healthcare sector during the week include Phase 3 topline data being reported by Journey Medical Corporation (NASDAQ:DERM) and Phase 3 PK data from Fortress Biotech (NASDAQ:FBIO) on the safety of DFD-29. The 2nd Annual RNA Therapeutics Summit will include participation from Sarepta Therapeutics (SRPT), Avidity Biosciences (RNA), and Ionis Pharmaceuticals (IONS), while ProQR Therapeutics N.V. (PRQR) will participate in the RNA Editing Summit. See a detailed list of key events for next week in Seeking Alpha's Catalyst Watch. | | Stocks Barron's mentions: While the focus in the financials sector this week will be on the earnings reports of major banks, the publication makes the case that some smaller banks may be value picks. In what is described as a classic case of throwing the baby out with the bath water, small banks with thriving businesses have seen their share prices fall sharply since the Silicon Valley Bank collapse. However, it was noted that small banks have seen their deposits remain stable, revenue increase, and loan volumes hold steady as customers from various industries seek money to grow their businesses. That has all added up to a boost in profits for some of the underappreciated players. The list of recommended small bank stocks includes Axos Financial (NYSE: AX), Bread Financial Holdings (NYSE: BFH), First Financial Bancorp. (NASDAQ: FFBC), OFG Bancorp (NYSE: OFG), Preferred Bank (NASDAQ: PFBC), and S&T Bancorp (NASDAQ: STBA). | | Seeking Alpha's Wall Street Breakfast Podcast Seeking Alpha's Wall Street Breakfast podcast brings you all the news you need to know for your market day. Released by 8:00 AM ET each morning, it is a quick listen that you can put on as you get ready to start your working day. | | | | |
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