It appears that cautious optimism was the name of the game on Wall Street following the Independence Day weekend celebrations, resulting in the best week it has experienced in the past twelve months. Cautious optimism can also be used to describe the mood among investors as companies prepare to start reporting second quarter profits and losses, with Alcoa (Dow component, Fortune 500, NYSE:AA) starting the ball rolling today, Monday July 12. Other Dow components expected to report in the upcoming week include JP Morgan Chase (NYSE:JPM), Intel Corporation (NASDAQ:INTC), General Electric (NYSE:GE), Bank of America (NYSE:BAC) and Google (NASDAQ:GOOG).
Investors will undoubtedly be keen to analyze second quarter results as they arrive, but forecasts for the balance of the year are of even greater importance as a basis for investment decisions moving into the future. Although it appears that the dreaded double-dip in the economy has been avoided, opinion is somewhat divided among economists and financial analysts as to what growth can be expected for the rest of 2010.
In addition to the trickle of second quarter results, the upcoming week offers a mix of reports relating to employment, retail sales, inflation and consumer sentiment. Tuesday sees the Commerce Department reporting on the US trade balance in the morning, while the Treasury budget, which is not typically a market mover, will be released in the afternoon. Intel’s second quarter results are also due on Tuesday. Prior to commencement of trading on Wednesday, the Commerce Department will release June’s retail sales report, with reports on business inventories, import/export prices and weekly crude oil inventories following during the day. The minutes of the latest Federal Reserve policy meeting and Fed economy forecasts will be made available in the afternoon.
Thursday is a busy day, with second quarter results expected from JP Morgan Chase and Google, the Department of Labor releasing the weekly report on jobless claims, and the Producer Price Index being released by the Commerce Department. Friday sees second quarter results from General Electric, Bank of American and Citigroup, as well as the Consumer Price Index from the Commerce Department and the University of Michigan‘s revised reading on consumer sentiment for July.
