With the S&P 500 ending Friday’s session at a new all-time high and near the high of the day and the week, the U.S. stock market closed out the third week of gains on a high note last week. The tech sector led the move even though the NASDAQ continues to lag behind the broader market. Both the Dow Jones Industrial Average and the Transports moved past new all-time highs. Expectations for robust earnings in Q1 drove the markets; however, some suggest that The Q1 earnings are already priced.
As Earnings season starts this week, about 3.0% Of the S&P 500 companies have reported calendar Q1 earnings, and the results have exceeded expectations. Answering the question is whether or not this trend will continue and by what margin. S&P 500 companies that fail to impress could cause the market to correct. Global economies are still being affected by COVID, so there is no certainty, which does not bode well for the stock market.