Three major conferences will keeps things busy next week in what would otherwise be the lull before earnings season.
The 36th Annual J.P. Morgan Healthcare Conference in San Francisco goes from Monday through Thursday of next week. It is the biggest sell-side healthcare conference of the year that can set the tone for biotechnology and pharmaceutical sectors.
Biotech stocks had a great 2016 despite the reduced amount of mergers and acquisitions. M&A is an important dynamic in a sector where the big players are flush with cash and looking for the next medical breakthrough (avenue for growth). Clarity on US taxes could start a flurry of deals in the space. Oncology powerhouse Celgene (CELG) will kick things off on Monday morning with guidance for fiscal 2017 and fiscal 2018.
The ICR Xchange (retail) Conference in Orlando is Monday through Wednesday. The conference features most of the big publicly traded retail and restaurant companies.
The retail sector (XRT) sold off yesterday after a number of Holiday sales reports out of the sector. Some disappointed (LB, FRAN) while some beat (ZUMZ). Retail stocks had a nice run to end 2017 as investors embraced value stocks after growth stock outperformed for most of the year. Holiday results were expected to be good following better than feared third quarter results. The consumer is the strongest it has been in a decade. Retailers have started to adapt to the increasingly difficult environment as ecommerce weighs on store traffic and the cold weather has been a nice tailwind.
The Consumer Electronics Show (CES) in Las Vegas starts this weekend. This is a trade-show without as much Wall Street presence so we won't see much in the way of financial guidance but all the big technology players (except Apple) will be there showcasing their latest innovations.
Fourth quarter earnings season kicks off the following week (JP Morgan and Wells Fargo will report next Friday, January 12). IN the meantime, we will see tons of preannouncements. Fourth quarter earnings season is more elongated -- its drags into March as the SEC allows more time for companies to file their annual reports on Form 10-K (than it does for the quarterly 10-Qs).
S&P 500 earnings are expected to grow just over 10% for the fourth quarter, putting growth for 2017 just under 10%, the best year since 2011. Earning growth is expected to accelerate to 12% next year, and that doesn't fully incorporate the benefit from the lower corporate tax rate.