What to Expect in the Week Ahead (Banks and Netflix Earnings; Consumer Sentiment and Powell Speaks)
Following last week's flurry of macroeconomic news, this week's focus shifts back to company matters. The US is where most of the main corporate action is taking place, with banks such as $Goldman Sachs (GS.US)$, $Bank of America (BAC.US)$, and $Morgan Stanley (MS.US)$, as well as $Netflix (NFLX.US)$, emerging as standout performers as the quarterly earnings season kicks off again.
Earnings Preview
The corporate earnings season kicks into high gear in the week ahead. Investors are expecting this first-quarter earnings season will show which businesses are able to continue withstanding higher pricing pressures, as well as the upcoming refinancing cycle. Results from major banks Bank of America, Goldman Sachs, and Morgan Stanley will likely take on greater significance for investors given JPMorgan's disappointing net interest income guidance this week. Overall, analysts expect S & P 500 companies to have grown earnings by more than 3% from the year-earlier period, FactSet data shows. If that's the case, it will mark the third straight quarter of earnings growth for the benchmark.
Inflation, Interest Rates, and Market Volatility
How corporate America is handling sticky inflation and the prospect of higher interest rates will be top of mind for investors in the week ahead, after this week’s choppy moves. The bull market is on edge. The Dow Jones Industrial Average and $S&P 500 Index (.SPX.US)$ registered their second straight losing week after a hotter-than-anticipated March consumer price index report weighed on the interest rate outlook for investors. Markets are now pricing in two rate cuts starting in September, CME FedWatch Tool shows, instead of the three rate cuts starting in June investors held in their base case prior to the CPI report.
Consumer Sentiment and Retail Sales
Next week will also bring a raft of economic data that could give insight into how the consumer is holding up — following the hotter-than-expected CPI for March as well as signs of weakening consumer sentiment. The March U.S. retail sales data set to release Monday is expected to show a deceleration from the prior month. Economists polled by FactSet anticipate a rise of 0.4% last month, down from a 0.6% increase in the previous reading.
Sectors Performance
Source: Dow Jones, Market Watch, CNBC, REUTERS
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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