The Week Ahead

Posted October 28, 2018 3:56 p.m. EDT

World Trade Organization to Hear U.S. Complaint on China

On Monday, the dispute resolution body of the World Trade Organization in Geneva will hear a complaint filed by the United States alleging that China’s regulation of foreign companies violates international rules protecting intellectual property rights. The complaint, part of President Donald Trump’s effort to check China’s growing economic influence, accuses Chinese companies of breaking patent laws by pilfering technologies after licensing agreements with U.S. companies end. Under WTO rules, China could block the first hearing but cannot block a second one from being held, probably as early as next month, according to U.S. officials.


Investors Will Be Looking for GE’s Turnaround Plan

H. Lawrence Culp Jr., the new chief executive at General Electric, has been on the job for less than a month. So when the troubled industrial icon reports results Tuesday, analysts will be looking less at the third-quarter numbers than the broad contours of the new chief’s turnaround plan. Two issues for the company: how to pull its power generation business out its tailspin, and the fate of the dividend. Analysts expect the 48-cent yearly payout to be cut by up to 90 percent, to conserve cash.


Wall Street to Watch Both Facebook’s Earnings and User Numbers

Facebook will report its earnings for the third quarter Tuesday, an event sure to be closely monitored by investors. The company has been battered throughout 2018, thanks in part to wide-ranging market volatility and controversy surrounding foreign influence campaigns operating across the service. But Wall Street was also shocked in July, when Facebook reported sales growth lagging far below expectations and company executives said little to explain the shortcomings. Expect the Street to keep a close eye on revenue growth trajectory, and if Facebook’s user numbers have flagged in the wake of major changes to how the News Feed operates.


New Figures Expected to Show Slower Growth in Eurozone

Official European Union figures coming out Tuesday are expected to show that growth in the eurozone slowed significantly from July through September. A period of unusually strong expansion has been interrupted by stock market turmoil, trade tensions, Brexit and even new emissions rules that slowed delivery of new cars. But Mario Draghi, president of the European Central Bank, insisted last week that although the eurozone is growing more slowly, it is not sinking into recession.


Apple Is Predicted to Post Strong Quarterly Earnings

Apple is scheduled to report quarterly earnings Thursday and analysts who track the company predict — surprise — that the good times are likely to continue for Apple, the world’s most valuable public company. Sales of iPhones have leveled off in recent quarters but people have been paying more for each device, sustaining a steady growth rate for the $1 trillion company. Apple is also expected to continue lifting revenues via its services businesses, including Apple Music, iCloud and its share of app sales. Only a fraction of the sales of Apple’s newest phones, including the iPhone XS, will be included in the earnings report because the phones went on sale about a week before the end of the quarter Sept. 30.


Dip Is Expected for New Vehicle Sales in October

Automakers will report Thursday the number of new vehicles sold in October, and analysts are forecasting about a 2 percent decline compared with October 2017. The drop is part of the downward trend that the industry has experienced since sales hit a record in 2016. On the brighter side, however, the pace of sales remains brisk and the total for this year is still expected to exceed 17 million.


Last Jobs Report Before Midterm Elections

On Friday, at 8:30 a.m. Eastern time, the Labor Department is scheduled to release its report on the nation’s hiring and unemployment for October, the last official snapshot of the economy before Americans vote in the midterm elections. After Hurricane Florence dampened growth in September, most Wall Street analysts are expecting payrolls to bounce back, with a monthly increase of 190,000. The jobless rate is expected to remain at the 3.7 percent level it hit in September, which was a nearly five-decade low. After two months of 0.3 percent growth in average hourly earnings, economists are expecting the pace to tick down to 0.2 percent. Even a slowdown from the previous months, however, would mean an improvement in the year-over-year figure (because the weak showing from October 2017 would drop out of the 12-month average). A rate of 3.1 percent would represent the strongest annual growth since April 2009.


Alibaba to Announce Earnings as China’s Economic Woes Deepen

On Friday, the Alibaba Group, China’s biggest online shopping platform, will announce how its financials fared during the quarter through September, a period of deepening gloom for the Chinese economy. The currency has been falling. Businesses and consumers are growing nervous about the possibility of a drawn-out trade war between China and the United States. Overall economic growth was the slowest in nearly a decade. In recent weeks, some analysts have been lowering their target price for Alibaba’s stock, expecting also that the company’s spending on new business areas — such as brick-and-mortar stores and food delivery — will continue to weigh on profits.


Stress Test Results on European Banks Will Be Released

European bank supervisors on Friday will publish results of the latest tests of lenders’ ability to weather financial or economic crises. The so-called stress tests examine what happens to banks’ capital and cash reserves in the event of various doomsday scenarios. Attention will be focused on banks in Italy, which could become collateral damage in their government’s dispute with the European Union. Italian banks are vulnerable because they have invested much of their capital in Italian government bonds, which have lost value as investors begin to doubt Italy’s solvency.


Exxon Mobil and Other Oil Companies to Report Earnings

Exxon Mobil, Chevron and Royal Dutch Shell all report their third-quarter earnings this week, and analysts and shareholders will be listening carefully to their guidance on future spending and the outlook for increased oil and gas production. Rising oil prices in the quarter should help profits. But prices are suddenly declining again owing to slowing global economic growth, plentiful stockpiles and increased production from Saudi Arabia and Russia. How executives view the future will help decide levels of investment, and offer clues to the profit picture for next year.