Stocks likely to drift as investors await Fed, earnings

Fri Mar 27, 2015 9:04pm EDT
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By Caroline Valetkevitch

NEW YORK (Reuters) - Wall Street investors may find little reason to make big moves next week as they await monthly U.S. jobs data and any news that could change expectations for the first interest rate hike in almost a decade.

The Labor Department report is due on Friday, when the stock market will be closed for Good Friday, leaving investors unable to trade on the data until the following week.

In the meantime, investors will continue adjusting to lowered earnings forecasts for the first quarter and the uncertain direction of the dollar.

Stocks have trended downward since rallying on the Federal Reserve's March 18 statement, in which it suggested a less-aggressive approach to raising interest rates than investors had expected.

"We're in this sort of information void right now," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia, which manages about $67 billion in assets. "We don't yet have the earnings season and there's almost nothing so significant as to rattle the equities market right now, so we're sort of in a pause."

Uncertainty surrounding the timing of the Fed's rate move has been one of the key factors for the market, creating more volatility and putting greater emphasis on economic data that could sway the Fed's outlook.

Adding to concerns about the Fed has been a dramatic rise in the U.S. dollar, which has weighed on U.S. stocks because of increased worries about earnings for U.S. multinational companies. The earnings season officially kicks off April 8, when Alcoa (AA.N: Quote) reports.

Up-and-down moves have left the S&P 500 .SPX virtually flat compared with the end of 2014.   Continued...

Traders work on the floor of the New York Stock Exchange March 25, 2015. REUTERS/Brendan McDermid