Earnings season kicks off and a wave of inflation data: What to watch this week

Earnings season is kicking off with inflation data and a dense slate of corporate reports, setting expectations for U.S. markets over the coming week. After a relatively quiet prior week, the S&P 500 ended Friday up 0.4%, gaining 1.2% for the week, while the Dow rose 0.3% Friday but finished down 0.5%, and the Nasdaq gained 0.3% Friday to close up 1.7%. This week, major banks effectively start the earnings run on Tuesday, with JPMorgan Chase, Goldman Sachs, Bank of America, Wells Fargo, and Citibank, followed Wednesday by Morgan Stanley and BlackRock. Results also include Johnson & Johnson and United Airlines on Wednesday, and Taiwan Semiconductor Manufacturing, Netflix, and UnitedHealth on Thursday. Economically, CPI data arrives Tuesday and PPI Wednesday, with University of Michigan sentiment expectations on Friday. Analysts say investors will focus on margins and inflation readings as the next test for the S&P 500, led by the financial sector.