Wall St week ahead: Bank earnings, CPI headline busy markets week as S&P 500 hovers near records
SPY•Bank earnings and inflation data are set to test the strength of corporate profits and the path of interest rates as the S&P 500 trades near records. Third-quarter S&P 500 earnings are expected to rise more than 30%, while September CPI is forecast to increase 3.7% year over year.
1. Banks open earnings season
JPMorgan, Goldman Sachs, Citigroup and Wells Fargo are scheduled to report Tuesday, followed by Morgan Stanley and Bank of America on Wednesday. Investors will be watching for signs of how higher interest rates are affecting consumer spending and capital markets; the S&P 500 banks index fell 7.5% over the past month.
2. Inflation and rates in focus
September CPI is expected to rise 3.7% year over year, with the core measure forecast to increase 2.5%. Producer prices and retail sales are also due, and data showing a hotter economy could revive expectations of another Federal Reserve rate hike.
3. Profit outlook and yields
Third-quarter S&P 500 earnings are expected to have risen more than 30%, following a strong first half. The 10-year Treasury yield was around 5.24% late Friday after recently reaching its highest level in 24 years, a level that can make bonds more competitive and pressure stock valuations.
