Futures in the Dow, S&P 500 and the Nasdaq are flat on Wednesday as rising Treasury bond yields and concerns that a COVID recovery will bring faster inflation hit the market.
TheStreet's Katherine Ross and Kace Capital's Kenny Polcari discussed breaking news in the stock market. Polcari spoke about earnings season, oil prices and the week ahead.
U.S. earnings season growth has come sooner than expected as corporate America rebounds from a coronavirus-induced recession.
Polcari said more than 80% of the earnings this time have beaten the estimates both in the top and bottom lines. "The average tends to be 70% to 75%, so, this was in retrospect, a good quarter. It is a recovery story. Next quarter earnings are expected to be good. Forward guidance from companies that are reporting is also very robust."
The largest refineries in North America were shut down Monday because of arctic conditions that have cut electricity, water and fuel supplies across Texas.
Polcari said once the economy recovers both in the U.S. and globally, demand for energy is going to soar. "Energy prices have been way undervalued. But I don't see oil touching $70 or $80 a barrel anytime soon. It will hover in the present $55 to $65 range in the near term."
Markets This Week
The Dow closes Tuesday at a record in mixed trading. All three key indexes had earlier extended records on hopes for fiscal stimulus and better vaccine distribution. Earnings season is coming to a close and TheStreet reviewed the top earnings to watch this week.
Polcari said he will be watching the final week of earnings season closely along with economic data to be released by the Federal Reserve later this week.