Weekly preview of Dow Jones, NASDAQ, S&P 500: FOMC, NFP, Apple, Microsoft, etc.

The S&P 500 index rose 1.1% last week, showing the market is approaching its new big target of 5,000. The previous record high of 4818 now looks set to keep the indicator in good mode if it continues to remain above this level on a daily basis.

The S&P 500 rose to new highs, helped by U.S. economic data and strong performance by technology stocks. Despite initial concerns over the poor performance of some industry giants such as GE, the market was buoyed by less-than-hospitable results from a survey of regional U.S. federal banks and a strong performance from Netflix. The reduction in the reserve ratio of China's state-owned banks also contributed to this increase.

The rally continued with further tone following the interest rate explanation and weakened European Central Bank decision. However, due to Intel's negative performance guidance, the stock closed with mixed signals.

The Dow Jones Industrial Average (DJI) rose 0.7% to hit a new weekly high. Lastly, the Nasdaq Composite Index (IXIC) also trended up 0.9%, but failed to close close to its weekly high after Intel's disappointing guidance.

packed schedule
This week's economic data and earnings calendar is full of high-risk events. “This may be the largest, or rather, ‘event reward’ reward in years,” noted Argus analysts.

First, the Federal Reserve is scheduled to conclude a two-day meeting on Wednesday. “We expect the Federal Reserve to stand still at the January FOMC meeting and change its guidance to policy rate stabilization language in a post-meeting announcement,” the bank's economists said.

On Friday we will hear about the state of the US job market in January. “Employment growth is once again expected to be narrowly driven by the public sector and high-cost service sectors,” the economists added.

In addition, several European Central Bank speakers are scheduled to give speeches this week, and consumer price index (CPI) data from Europe, including Germany, will be released.

Announcement of performance by large stock companies
When 25% of S&P 500 companies actually reported earnings, 69% exceeded earnings per share expectations and 68% exceeded sales expectations. The current performance decline rate is -1.4%, which is lower than the expected performance growth rate (4th quarter) of +1.5%.

This week is expected to be one of the busiest with planned earnings for more than 100 companies, representing about 40% of the S&P 500's earnings.

On Tuesday, Microsoft and Alphabet are scheduled to report earnings for the December quarter. In addition, AMD, United Parcel Service, Pfizer, and Starbucks will also announce their performance.

Mastercard, Qualcomm and Boeing are other big companies to watch on Wednesday, while tech companies Amazon, Apple and Microsoft are expected to take the stage on Thursday.

The explosive earnings week is expected to end with the performance of Enoxomobile and Chevron.

What analysts say about US stocks
Openimer analysts: “We will continue to support cyclical industries over defensive sectors. • Established technology companies that are deeply embedded in businesses and the lives of consumers are likely to emerge as major prospects.”

Analysts at RBC: “There are four big things to know. First, we could explain the fourth quarter earnings season with mixed results to date. Second, our supply/demand assessment reflects the macro background and outlook. "We believe there will be a wide range of opinions, highlighting the continued importance of addressing the challenges associated with inflation and high costs. Thirdly, we have also looked at some improvements to our appraisal and valuation models."

Analysts at JPMorgan: “We will continue to move away from our preferred value-to-growth range in 2023, 2021 and 2022. The US is likely to have an advantage over the Eurozone as the market continues to be narrow, heavy and driven by technology. “This is large. We prefer quality growth over cyclical value in equity assets, so the US will continue to outperform the Eurozone.”

Golduman Sachs: “Many investors are concerned about how steep and normalizing so-called yield curves will affect stocks, especially in light of the recent negative correlation between stock prices and bond yields. But the importance of economic growth to stock returns is Whether the earnings curve is steep or flat is more important: Stocks usually produce the greatest returns during periods of strong economic growth, and unless the U.S. economy falls into a recession, stock returns will be positive after the earnings curve normalizes. "

Analysts at BTIG: “SPX has been up for 12 of the last 13 weeks. The last time that was in 1985. The upside is clearly strong, but there are some signs of fatigue here. SPX is up 38% this week. “We plan to announce our results this week, there is also an FOMC meeting, and now is a time when a temporary break/reduction is needed.”