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Day Ahead: Top 3 Things to Watch

Published 10/07/2019, 03:18 PM
Updated 10/07/2019, 03:44 PM
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Investing.com -- Here's a preview of the top three things that could rock markets tomorrow.

1. Wholesale Inflation

Wholesale inflation figures arrive Tuesday, providing traders with further insight into the pace of price pressures.

The Labor Department will issue the producer price index (PPI) report at 8:30 AM ET (12:30 GMT). On average, economists expect the PPI rose 0.1% in September, the same as it rose the month before.

The core PPI, which excludes volatile food and energy prices, is forecast to have risen 0.2% last month, from 0.3% in August, according to forecasts compiled by Investing.com.

That would bring year-over-year PPI growth to 1.8% and core PPI growth up 2.3%, unchanged from a month earlier.

The PPI is considered a leading indicator, measuring the input prices for goods sold at a retail level.

2. U.S. Crude Oil Inventories Set for Another Surprise Build?

The American Petroleum Institute's petroleum data will be closely watched for signs on whether domestic crude inventories will continue to shrink following a draw last week.

API data last week showed inventories fell 5.9 million barrels, though that differed from the 3.1 million build reported by the Energy Information Administration.

Oil prices reversed early gains to settle roughly flat at $52.75 per barrel amid worries of U.S. and China trade talks, slated for later this week.

3. Levi Strauss, Domino's Pizza to Deliver Quarterly Earnings

Levi's (NYSE:LEVI) is set to report earnings on Tuesday after U.S. markets close.

The report comes as analysts are keen to establish whether the apparel retailer's efforts to expand beyond its native men’s jeans business and its direct-to-consumer push have helped it to offset the sluggish retail backdrop that has weighed on its peers' margin growth.

The direct-to-consumer approach has gathered importance recently as department stores – who some merchants like Levi's have relied on for sales - come under pressure.

Annual sales at U.S. department stores fell 20% from 2017 to 2018, and are on pace to decline further this year, according to the U.S. Census Bureau.

Levi's is expected to report earnings of 28 cents per share on sales of $1.44 billion, according to estimates from Investing.com.

Domino’s Pizza (NYSE:DPZ) delivers results Tuesday before the market open, with the company expected to report earnings of $2.07 per share on sales of $824 million.

Beyond earnings, same-store sales, which have been slowing for several quarters, will also come under the spotlight.

The company’s sales have taken a hit from growing competition from third-party delivery providers such as Uber Eats, DoorDash and Grubhub (NYSE:GRUB).

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