What to expect next week: JPMorgan, Netflix, PepsiCo, and More

Big Week Ahead: JPMorgan, Netflix, PepsiCo Set to Drive Market Buzz

The second-quarter earnings season is starting, with big banks like JPMorgan and Morgan Stanley leading the way. Investors and analysts are watching closely, not just for company profits, but also for how trade tensions and interest rate changes may affect the market. Recent stock gains show positive momentum, but there’s still uncertainty ahead.

Keypoints:

• Big-bank earnings signal the start of Q2 reporting season.

• Analysts expect S&P 500 earnings to grow 4.1% year-over-year.

• Companies so far have beaten average expectations.

• Trade policies and interest rates remain major concerns.

• Forecasts have been cut more than usual, suggesting caution.

Analysts are hopeful for growth this quarter. According to UBS, earnings for S&P 500 companies are expected to rise 4.1% compared to last year. So far, the companies that have already reported results have done better than expected. Historically, analysts first set high expectations, lower them before earnings, and then results often beat the lowered forecasts.

Even with some strong signs, there are reasons to be cautious. Analysts have recently lowered their earnings forecasts more than usual for this quarter. Big names like PepsiCo, TSMC, and Netflix will also report their results soon, giving a better picture of overall consumer spending, tech trends, and business health.

Trump’s tariffs will likely be a big talking point;

Tariffs are expected to have a noticeable impact on second-quarter earnings. Deutsche Bank estimates they will reduce S&P 500 profits by about 2 percentage points, with the effect likely to grow in the coming months. Around 25% of S&P 500 earnings come from companies heavily affected by tariffs.

As companies try to manage rising costs, Goldman Sachs expects 70% of those costs to be passed on to consumers through higher prices. While the economy remains strong overall, uncertainty around tariffs continues to worry businesses.

Also read: Markets slide as Trump announces more tariffs