TORONTO — The stock market spotlight will turn to corporate earnings this week as major U.S. companies line up to issue their latest quarterly results and future outlook amid the shaky economy.
The specifics of the reports could send markets spiralling downwards if they don’t meet expectations, some analysts suggest.
“The market has factored in good earnings and the market has actually discounted good guidance as well,” said Jim Herrick, director of equity trading at Baird&Co. “So if we don’t see that, the market will retrace.”
On the earnings schedule are major U.S. financial institutions like JPMorgan Chase&Co., Citigroup Inc. and Bank of America Corp. The banking sector has played a major role in sending the market higher.
It could be a rocky trading week if company results and outlook don’t meet investors expectations.
“There certainly seems to be hope that revenue will help the picture,” said John Johnston, chief strategist at the Harbour Group at RBC Dominion Securities.
“The bottom line is going to be very good in terms of cost savings.”
On the Toronto Stock Exchange, investors will be trading in a shortened week after the Thanksgiving holiday on Monday.