Corporate earnings are always a major catalyst for the stock market. Not only does Wall Street use earnings season to get a good read on a company's financial strength and how this may impact its share price down the road, but it also looks at the results, guidance and commentary from management to see how things such as inflation, interest rates and government policies are impacting corporations.
"This earnings season will be crucial, testing the post-election optimism," write BofA Securities strategists Ohsung Kwon and Savita Subramanian. "We expect a more upbeat tone with accelerating post-election trends, but guides are likely to be conservative as usual in January and February."
