What to Expect in the Week Ahead (MS, GS, and TSM Earnings; Retail Sales Data)

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What to Expect in the Week Ahead (MS, GS, and TSM Earnings; Retail Sales Data)

As we approach next week, the earnings season is set to gradually pick up pace, with the remaining major banks scheduled to report their financial results. Additionally, investors will remain focused on analyzing the Consumer Price Index (CPI) and Producer Price Index (PPI) data in anticipation of the Federal Reserve's upcoming meeting on January 30-31.

The market is closed for Martin Luther King Jr Day. $Morgan Stanley (MS.US)$, $Goldman Sachs (GS.US)$ and $Interactive Brokers (IBKR.US)$ kick off the shortened week with earnings on Tuesday. $Charles Schwab (SCHW.US)$, $U.S. Bancorp (USB.US)$ and $Alcoa (AA.US)$ are set to release their quarterly earnings on Wednesday, following the likes of $Taiwan Semiconductor (TSM.US)$, $Truist Financial (TFC.US)$ and $Fastenal (FAST.US)$ on Thursday. $Schlumberger (SLB.US)$ and $State Street (STT.US)$ will release their results on Friday.

Starting the shortened trading week, $Goldman Sachs (GS.US)$ and $Morgan Stanley (MS.US)$ are set to release their earnings, coming on the heels of Bank of America, JPMorgan Chase, Wells Fargo, and Citigroup, which reported last Friday. Investors are looking forward to seeing if these banks can deliver improved results compared to the performance of their peers at the end of last week.

Investors with a focus on technology will be closely monitoring the earnings report from $Taiwan Semiconductor (TSM.US)$, while those interested in the financial sector will be keenly observing the financial results from Discover Financial Services.

Looking ahead to a week with fewer trading days, the spotlight will be on the U.S. consumer through retail sales figures and bank earnings, coming after a week where stocks remained resilient near record highs despite a higher-than-anticipated inflation report. The market, particularly led by a tech-driven surge in the $Nasdaq (NDAQ.US)$, showed strength, and although economic data will be scant in the coming days, investors may see increased volatility as they assess the state of the consumer economy.

Retail sales

Retail sales data for December is scheduled for release on Wednesday. Economists surveyed by FactSet are projecting a 0.4% increase for the month, slightly higher than the 0.3% growth seen in November. Data on December housing starts and building permits will also be released on Thursday, offering further insight into whether activity in the sector has picked up as mortgage rates have fallen. According to consensus estimates from FactSet, U.S. housing starts or new residential constructions are expected to decline by 7.1%, which would be below the 14.8% increase reported last month. Economists surveyed by FactSet say that the number of new residential buildings authorized for construction in the U.S. is expected to rise to 1.48 million, an increase from last month's 1.46 million.

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