Wall St. Week Ahead: As Fed takes a backseat, earnings rule market
By Alison Griswold
NEW YORK (Reuters) - Wall Street is experiencing its best month since January and looks poised to extend the rally with a deluge of earnings next week, though significant gains may be harder to come by with major indexes at record highs.
Eight Dow components and Apple (AAPL.O: Quote) are among the companies that will report in one of the busiest weeks of the earnings season. Some 157 companies in the S&P 500 index will release results.
Second-quarter earnings have been above forecasts so far, but analysts' estimates have dropped precipitously since the start of the year. Earnings for S&P 500 companies are seen rising 2.9 percent, according to Thomson Reuters data, down from an 8.4 percent growth expected at the start of the year. Revenue is seen growing 1.1 percent.
Still, stronger-than-expected reports spurred gains in IBM (IBM.N: Quote), General Electric (GE.N: Quote) and others. In addition, Wall Street banks Citigroup, Goldman Sachs and Morgan Stanley reported strong earnings.
For this week, the Dow rose 0.5 percent, the S&P added 0.7 percent and the Nasdaq fell 0.3 percent. The benchmark S&P is up 18.6 percent for the year.
On the other side of the ledger, Microsoft (MSFT.O: Quote) was a big disappointment, and its shares fell 12 percent on Friday. Both Microsoft and Google (GOOG.O: Quote) fell short of Wall Street expectations, causing their shares to slump.
Of the 104 companies in the S&P 500 that have reported through Friday, 65.4 percent had earnings above analyst expectations, while 51 percent topped revenue estimates.
EYES ON APPLE Continued...