Coming Week: Building on Wells Fargo

Wells Fargo (WFC) kicked off an earnings-related rally on Thursday, and the market sentiment may have improved enough to build upon those gains next week.

Since the start of March, the Dow Jones Industrial Average, S&P 500 and Nasdaq have all soared more than 10% on signs that the economy and financial markets have begun to improve -- or at least not get worse. Wells Fargo on Thursday ended the holiday-shortened week by becoming the first major bank to follow through on earlier rosy statements, saying it expects to report $3 billion in first-quarter earnings in a preliminary earnings report.

Next week, major companies across the economic spectrum will report results, starting with CSX (CSX), Goldman Sachs (GS), Intel (INTC) and Johnson & Johnson (JNJ) on Tuesday, followed by American Airlines parent company AMR Corp. (AMR) on Wednesday, Google (GOOG), JPMorgan Chase (JPM) and Southwest Airlines (LUV) on Thursday and BB&T (BBT) on Friday.

Steve Darden, wealth advisor at Williams Financial Advisors in Shreveport, La., is hoping that other banks also wrote down their assets far enough so that first-quarter results are not held back by unexpected charge-offs. But even if some miss expectations, Darden thinks the market rally will continue on through next week. He notes that even retailers that have been hard-hit by strained consumer spending have been issuing sunny forecasts recently, with six out of seven companies' predictions beating expectations.

"We sure tend to think that most of the bad news is priced in now," says Darden. "Things will have to be really, really bad next week for the market to respond negatively."