Meantime, Brian Belski, chief investment strategist at BMO Capital, discussed his firm's call that stocks are "likely to take a breather between now and year end" on Monday, saying it's "unfortunate" this has been interpreted as a sell signal since BMO's year-end target for the S&P 500 is 1425, below the index's close at 1440 on Monday.
"While we expect the market to trade in a fairly narrow range for the next several months, we believe it is inappropriate for investors to approach US equity investing with an 'am I in or am I out' strategy, particularly considering that correlation amongst stocks continues to decline near multiyear lows," he wrote, adding that "plenty of opportunities" still exist in equities for active and disciplined investors.
As for Tuesday's scheduled news, earnings season really starts to pick up in the a.m. with three Dow components releasing results before the opening bell: Coca-Cola (KO - Get Report), Johnson & Johnson (JNJ) and UnitedHealth (UNH).
Goldman Sachs's (GS - Get Report) numbers will hit the tape bright and early as well and Thomson Reuters has tabbed the bank as a likely candidate for an upside surprise. The firm noted its research shows the consensus view has been moving higher since September and that the analysts who have been the most accurate in the past are particularly bullish this time around.The average analyst estimate is for earnings of $2.12 a share from Goldman in the third quarter on revenue of $7.3 billion but Thomson Reuters said: "Two StarMine-rated five-star analysts are betting Goldman will do even better, with estimates of $2.70 and $2.75. Goldman's Q3 revenue estimates have moved higher since September as well, with the current mean value at $7.301 billion, and the revenue SmartEstimate 1% higher at $7.372." Thomson's StarMine estimate is looking for a profit of $2.20 a share, roughly 4% above the mean view, and the firm notes a variation of more than 2% in either direction has historically resulted in an earnings surprise in that direction more than 70% of the time. Other early reporters include Domino's Pizza (DPZ), Forest Laboratories (FRX), Mattel (MAT), Omnicom (OMC), PNC Financial (PNC), State Street (STT), W.W. Grainger (GWW), and Wolverine World Wide (WWW).