Downbeat week for US and Europe

MARKET OUTLOOK

- US: US markets were under pressure during the past week as the last round of economic data reduced the likelihood of a rate cut in the near future. Materials and energy stocks closed much lower while software and tech hardware stocks closed on a positive note. Technically, notwithstanding a limited further consolidation, the outlook should remain bullish.

- EUROPE: After a good start, European markets closed the week on a negative note. Stocks from the basic resources and oil and gas clearly led the decline while healthcare and telecommunication stocks outperformed. Technically, last Friday's correction should let room for a bounce in the forthcoming days.

COMPANY PREVIEW

Freddie Mac (USD 66.91 ; -2.14% ; FRE ; FRE.N)

Freddie Mac was expected to release its 1Q results on Tuesday. 1Q EPS was expected to reach $1.33 ($0.34 a year ago). However, last Friday, the Co provided a quarterly market update and gave estimates for the 3Q of 2006. The group reported a $550m net loss, compared to $880m last year, and had an undetermined loss in the 4Q as lower bond yields reduced investment returns. Results are preliminary estimates as the Co continues a 3Y overhaul of its accounting. President and COO Eugene McQuade said the group won't provide results for 1Q07 until the second half of the year and intends to provide 2006 results by the end of March.

Alcoa (USD 28.76 ; -4.2% ; AA ; AA.N)

Alcoa will report its earnings on Tuesday after market. The group is expected to announce 4Q/Dec EPS of $0.65 ($0.35 a year ago) on a revenue of $7.63bln ($6.67bln). Alcoa should benefit from strong results due to higher realised aluminium prices. Analysts will look for strength in the group's aerospace and power generation businesses, with a pull-back in auto division product sales. Attention will also be paid to Alcoa's comments on average aluminium prices and consolidation trends in the sectors.

Supervalu (USD 36 ; -0.55% ; SVU ; SVU.N)

Tuesday, Supervalu is also scheduled to report 3Q/Nov EPS of $0.57 ($0.57 a year ago) on a revenue of $10.53bln ($4.69bln). The Co is expected to post strong revenue and solid EPS results. The market will look at new store openings, same store sales, administrative streamlining, supply chain improvements and synergies stemming from the Albertsons' stores acquisition. Analysts will also pay attention to the group's regional market share gains, overall margins, and strategic plan for 2007. In other news, Supervalu announced last Friday it is in talks to sell as many as 15 Milwaukee area stores operating under the Jewel-Osco banner to Roundy's Supermarkets.

Suedzucker (EUR 18.34 ; 0.06% ; SZU ; SZUG.DE)

Suedzucker will report 3Q/Nov earnings on Thursday. Last year, the group's 3Q net income reached E73.1m, EBIT E111.8m and net sales E1.347bln. Shares of the company recently declined on concern that the EU's targeted quotas for reducing production are not being met. The EU is reducing sugar exports after Brazil last year won a WTO ruling preventing growers in Europe from exporting their surplus production.

M and T Bank (USD 120.41 ; -1.69% ; MTB ; MTB.N)

Finally, the same day before market opens, M and T Bank delivers its quarterly earnings. The Co is expected to reach 4Q/Dec EPS of $1.88 ($1.78 a year ago). The group is seen posting inline 4Q EPS results and analysts will review the Co's loan portfolio, fee income, new market performance, overall costs, sector position and margins.