S&P500 Analysis: Can Strong Earnings Keep US Indices on Bullish Track?…

This week’s earnings releases are expected to be key drivers for market sentiment.

On Tuesday, Bank of America, Goldman Sachs, and Johnson & Johnson will report their latest results, while Wednesday brings earnings from Morgan Stanley and United Airlines. Walgreens Boots Alliance, Netflix, and Procter & Gamble will also be in focus.

So far, 30 S&P 500 companies have exceeded earnings estimates by an average of 5%, beating last quarter’s 3% average beat.

The market hit record highs last week, led by a resurgence in banking profits, with the S&P 500 closing above 5,800 for the first time and the Dow also reaching new peaks.

Rising Treasury Yields and Geopolitical Risks Cloud Sentiment

While earnings optimism is driving the market, rising Treasury yields and geopolitical risks are creating uncertainty. The 10-year Treasury yield climbed above 4.1% last week, raising concerns about higher borrowing costs across the economy, particularly in the housing market. At the same time, geopolitical tensions in the Middle East and uncertainty around Federal Reserve policy are keeping traders cautious despite the bullish earnings backdrop.