U.S. stocks could be off to a mixed start on Monday after averages posted weekly gains for a fifth straight week. The bond market is closed for Columbus Day, a federal holiday, but the stock market will trade during regular hours. The majority opinion among strategists points to a possible pause in the stock rally in the next few weeks before resuming in the final two months of the year.

However, the earnings news flow will gain momentum in the coming days and cushion any downside. Cumulative earnings for S&P 500 companies are expected to rise for the fifth straight quarter, according to FactSet. However, this would mark a slowdown from the 11.2% growth reported for the second quarter.

On Monday, traders could focus on a few Fed speeches and a survey of consumer inflation expectations and bond yields, while also looking ahead to some key earnings reports later in the week.

In pre-market trading on Monday the SPDR S&P 500 ETF Trust SPY rose 0.19% to $580.68 and the Invesco QQQ ETF QQQ rose 0.33% to $495.07, according to Benzinga Pro data.

Last week's notes:

Although consumer price inflation data surprised investors, the market had enough momentum to extend the rally in the week ending October 11. A rise in bond yields on the back of some recent strong data and the threat of Hurricane Milton also put downward pressure on the market. While the market was weak, a favorable report on producer price inflation and a strong start to earnings from the major banks offset the impact.

The Dow Jones Industrial Average and S&P 500 Index ended at new intraday and closing highs, while the Nasdaq Composite inched closer to its previous closing high of 18,509.34 set on July 16.

Insights from analysts:

Yardeni Research reiterated its call for the S&P 500 to reach 8,000 by 2030 under its “Roaring 2020s” scenario. The index will be supported on its rise by earnings rather than rising valuation metrics, the company said. The comments came following the second anniversary of the bull market that began on October 12, 2022.

The period was marked by widespread fears of a recession due to monetary tightening, the company said. “These fears continued until October 4 this year, when a stronger-than-expected jobs report reaffirmed that the young bull was correct in expecting inflation to fall while the economy remained robust,” it said.

According to Yardeni Research, since October 12, 2022, all major stock market indices are up at least 20%, with the S&P 500 up 62.6%. The S&P 500's performance is par for the course compared to the last eight bull markets, it said.

As momentum continues to point clearly upwards, says Fund Strat Head of Research Tom Lee said his company has advised clients to remain cautious but at the same time buy on dips. In an interview with CNBC on Friday, the strategist said investors want to see who ends up becoming president. “We are in a time where the market is on the edge,” he said.

At the same time, 2024 has been such a strong year, he said, adding that the last two weeks have proven that the macro economy is now taking a step back and liquidity and cash on the sidelines are becoming the dominant factor, Lee said. “There is a lot of firepower to support stocks after the election,” he said.

The Fed is dovish, the economy appears healthy and therefore the three- and six-month outlook for stocks is very positive, he added.

See also: How to trade futures

Upcoming economic data

This week's economic calendar is dominated by Fed speeches, September's retail sales report and some manufacturing and housing data. The New York and Philadelphia Feds will release the results of their respective manufacturing surveys in October, and the Fed is expected to release its industrial production data for September. Housing data due this week includes the National Association of Home Builders Housing Market Index for October and the Commerce Department's housing starts report for September.

• On Monday, the Minneapolis Fed president said Neel Kashkari will appear publicly at 9:00 a.m. EDT and 5:00 p.m. EDT.
• The New York Fed is scheduled to release the results of its September consumer expectations survey at 11 a.m. EDT. In August, one-year and five-year inflation expectations remained unchanged at 3% and 2.8%, respectively.
• Governor of the Federal Reserve Christopher Waller The lecture is scheduled for 3 p.m

Stocks in focus:

• Tesla, Inc. TSLA rose 1.80% in premarket trading after plunging nearly 9% on Friday.
• Sirius XM Holdings Inc. SIRI rose by almost 6% thereafter Berkshire Hathaway, Inc. (NYSE; BRK-A) BRK increased his stake in the company.
• Boeing Co. B.A fell over 1.70% after the company announced 10% reductions in its workforce.
• Bitcoins BTC/USD The rally past $64,000 sent crypto-related stocks such as MicroStrategy, Inc. MSTR And Coinbase Global, Inc. COIN higher.

Commodities, Bonds and Global Stock Markets:

Crude oil futures slumped early in the New York session, losing nearly 2.75%, as traders became jittery following the release of weak China data. Gold futures barely changed.

The 10-year Treasury yield rose slightly to 4.096%.

Most major Asian markets closed higher on Monday, led by the Chinese market. Markets in New Zealand and Hong Kong retreated while the Japanese market was closed for a holiday.

European stocks showed some restraint and were mostly in the red in early trading.

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