S&P 500 Index Outlook: Top Catalysts for US Stocks This Week
The S&P 500 Index has moved sideways since August and is hovering near its record high. It ended last week at 7,722 points, about 1.2% below the peak of 7,817 points. This article looks at the key catalysts likely to drive the stock market this week. US Stocks to React to Key Corporate Earnings The main catalyst for the S&P 500 and other US indices this month will be the third-quarter earnings season, which officially starts next week when top banks such as JPMorgan, Goldman Sachs, and Morgan Stanley release their results. Some major companies will publish their earnings this week. PepsiCo (NYSE: PEP ), the beverage and snack giant valued at over $171 billion, will set the tone on Thursday. It will be followed by Delta Air Lines (NYSE: DAL ) on Friday. Analysts are highly optimistic about the upcoming earnings season, with the average estimate pointing to earnings growth of more than 29%. This growth is expected to be driven by industries such as technology and energy. Strong earnings growth will arrive at a time when the S&P 500 Index is trading at relatively cheap levels. FactSet (NYSE: FDS ) data shows that the index has a forward price-to-earnings ratio of 19, which is below it
The S&P 500 Index has moved sideways since August and is hovering near its record high. 2% below the peak of 7,817 points. This article looks at the key catalysts likely to drive the stock market this week. US Stocks to React to Key Corporate Earnings The main catalyst for the S&P 500 and other US indices this month will be the third-quarter earnings season, which officially starts next week when top banks such as JPMorgan, Goldman Sachs, and Morgan Stanley release their results.
Some major companies will publish their earnings this week. PepsiCo (NYSE: PEP ), the beverage and snack giant valued at over $171 billion, will set the tone on Thursday. It will be followed by Delta Air Lines (NYSE: DAL ) on Friday. Analysts are highly optimistic about the upcoming earnings season, with the average estimate pointing to earnings growth of more than 29%.
This growth is expected to be driven by industries such as technology and energy. Strong earnings growth will arrive at a time when the S&P 500 Index is trading at relatively cheap levels. FactSet (NYSE: FDS ) data shows that the index has a forward price-to-earnings ratio of 19, which is below its five-year and ten-year averages. Read Also: SpaceX Stock Crosses Key Level Amid Launch Milestones as Lockup Expirations Near Federal Reserve Minutes The S&P 500 Index will also react to the upcoming Federal Reserve minutes of the last meeting, in which officials decided to hike interest rates for the first time this year.
75% and 4%, with many officials hinting that they would support another hike. The upcoming minutes, which will be published on Wednesday, will provide more color about what they deliberated in the last meeting. However, the implication of these minutes will be relatively muted because of the recent macro data. Data released last week showed that the headline and core personal consumption expenditure (PCE) were softer than expected.
2%. These numbers mean that the bank will not be under pressure to hike. Bond Market Jitters The S&P 500 Index will also react to activity in the bond market, which has come under pressure in recent months. Short- and longer-term bond yields have climbed to their highest levels in decades amid concerns about rising public debt.
Bond yields pulled back slightly last week after the US pressured other G7 countries to release 100 million barrels of oil from their strategic reserves. They also retreated after weak US inflation and jobs data. Still, the bond market could remain under pressure this week, which would weigh on stocks. One potential source of jitters is energy prices, which may jump if the war between the US and Iran escalates.
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