Monday kicks off a gangbuster week of earnings reports. This should be a very interesting time. With much of the market focused on unresolved budget issues in Washington, it’ll be nice for traders to focus on something more related to markets.
Sentiment towards earnings for the recently completed third quarter seems rather positive as we compare estimates. This may be true, of course, having seen few if any earnings warnings. However, that may not be the case with guidance —the important points where companies see their forward business opportunities.
WATCH THE GUIDANCE
In recent quarters most CEO’s and executives have been expressed guarded optimism, and with some of the potential downside from a government shutdown and debt ceiling battle this could tip an already fragile economy over into more troublesome waters.
KEY SECTORS
The first round of third quarter earnings next week is light but some important data points will be analyzed. Over the coming weeks I’ll be looking at banks, financials, tech, industrial and transports as the key drivers to stock market performance. Further, we’ll have to see how the recent issues translate into current and future results.
I’m optimistic this time around but there are certainly many potholes in the road that can cause a flat tire for the economy.
