NEW YORK (

TheStreet

) -- September was supposed to be a terrible month for equities and -- surprise! -- the market has continually established new 2009 highs seemingly on a daily basis. Thus far, the big September pullback bears prophesized has yet to materialize.

But as sentiment begins to turn positive and the

Dow Jones Industrial Average

inches closer to the psychologically important 10000 level, market analysts warn bullish investors to tread carefully in the coming week. There are lots of economic reports and corporate events that could act as negative catalysts.

"Last week we had a great deal of economic data, most of it better than expected, but we didn't have the reaction that matched the magnitude of the good news," said Art Hogan, chief market strategist with Jefferies. "Next week we get another shot at that, but there's an overarching feeling that at some point in time we need to see a pullback in this market."

Jim Paulsen, chief investment strategist with Wells Capital Management, finds it problematic that a majority of traders were bullish heading into the weekend, especially with Dow 10,000 in reach, as it elevates the risk for a market correction.

"The conviction was so strong coming into this month that September would be horrible," Paulsen said. "Now there is shallow positive sentiment. You have people reluctantly saying the market could go higher, so after a bad day or two you might have them jumping off the boat. That puts us in the position to create a negative catalyst we can point to. Fundamentally, the news is better. But sentiment is waffling."

Of course, both Paulsen and Hogan don't necessarily expect a pullback to come next week. "I'm not predicting a selloff next week," Paulsen said. "I think we still have more upside to the market, but it isn't going to come in a straight line. You know you're going to have pullbacks along the way."

Skittish investors will always be on the lookout for a negative catalyst, though. They will undoubtedly be fixed on the

Federal Reserve's

latest statement on interest rates, which will be released Wednesday after the Federal Open Market Committee concludes its two-day meeting. Following the latest reads on the government's consumer price and producer price indices, as well as rising commodity prices, inflation watchers will wait to see what the Fed's statement will include.

"

The Fed members have been extremely good at spelling out the reasons for their ongoing aggressive monetary policy," Hogan said. "And they have to do that now on the heels of slightly higher CPI and PPI data and a commodities complex that remains strong."

Paulsen said he's not expecting any surprises after

Fed Chairman Ben Bernanke's speech

last week, where he said that the recession is likely "technically" over. "This Fed meeting is the type of meaningless thing that people use to create a move in the short term," Paulsen said, joking that "this could be the negative catalyst everyone speaks of."

Instead, the bulk of economic data in the coming week, which reflect residential real estate and the consumer, is where attention should be focused. Hogan notes that both areas are where the recent pattern in data has been strong, which may keep the rally from derailing next week.

Before the housing and consumer reports hit, the week kicks off with the August read on leading economic indicators. The Conference Board's report, due at 10 a.m. EDT Monday, is expected to show that indicators rose 0.7% last month after a 0.6% increase in July, according to economists polled by

Reuters

.

On the earnings schedule, homebuilder

Lennar

(LEN) - Get Report

will report quarterly results before the start of trading Monday, with business-service provider

Synnex

(SNX) - Get Report

set to post results after the closing bell.

Tuesday's economic docket is thin, with the Federal Housing Finance Agency scheduled to release its July home price index at 10 a.m. EDT. Meanwhile, several companies are set to report earnings before the start of trading, including

ConAgra

(CAG) - Get Report

,

CarMax

(KMX) - Get Report

and

Carnival

(CCL) - Get Report

.

The Fed's rate decision will be in the spotlight Wednesday. Investors will also be focusing on the Energy Department's weekly inventory report, due at 10:30 a.m. EDT, as well as earnings from

General Mills

(GIS) - Get Report

and

AutoZone

(AZO) - Get Report

before the start of trading and

Bed Bath & Beyond

(BBBY) - Get Report

and

Paychex

(PAYX) - Get Report

after trading ends.

Thursday brings what Wells Capital's Paulsen argues is the most important report of the week: the Labor Department's weekly report on initial jobless claims. Last week, the Labor Department said initial jobless claims fell to 545,000, the lowest level in two months, from a revised 557,000 in the previous week. Paulsen argues that jobless claims need to fall below the 500,000 level in order to show a recovery is in the works.

"The most important report this week will be the claims number," Paulsen said. "I would argue, and this is from a bull, that the initial claims numbers have not come down more rapidly. I want to see that number

moving

. There are a lot of data that show me a V-shaped recovery but claims isn't one of them. It's highly volatile, yes, but it needs to make a bigger move lower to fit with a lot of the other information we're getting."

In addition to the jobless claims data, investors will grapple with the August reading on existing home sales, which economists expect will rise to 5.33 million units from 5.24 million in July, as well as earnings from

Rite Aid

(RAD) - Get Report

and

McCormick

(MKC) - Get Report

early in the day.

After Thursday's close,

Research In Motion

(RIMM)

will get the most attention. The Blackberry maker is expected to report quarterly earnings of $1 a share on revenue of $3.62 billion, according to Thomson Reuters.

Finish Line

(FINL)

will also be on Thursday's late slate of earnings.

Earnings from

KB Home

(KBH) - Get Report

will take a backseat Friday to the day's economic reports, which include the August read on durable goods orders, new home sales in August and the University of Michigan's revised read on consumer sentiment in September.

Jefferies' Hogan said it will be important to watch news emanating from a number of conferences to be held next week.

Bank of America

(BAC) - Get Report

,

RBC Capital Markets

(RY) - Get Report

and

UBS

(UBS) - Get Report

, among other banks, will hold conferences featuring a broad range of companies, from small- and mid-cap companies to power and gas leaders to financial institutions.

In the previous week,

Barclays

held its global financial services conference in New York. Several important stories came out of the meetings, including

Citigroup

CEO Vikram Pandit's acknowledgment that the $100 million paycheck for Phibro head Andrew Hall is excessive, a criticism leveled against the energy trading unit by the U.S. government.

"This is the time of year when

everyone

has a conference," Jefferies' Hogan said. "This gives corporate America a chance to give us guidance, a window into demand and an outlook for 2010. So far, it's been more good than bad."

Paulsen said he will be watching to see whether financial stocks like Citigroup and Bank of America begin to outperform again. "These stocks had a nice pop and they've held it, but I'd like to see them advance it further," he said. "We've seen that in industrials, which have had a huge couple of weeks. But I'd like to see financials take on leadership as it would help people get more bullish."

-- Written by Robert Holmes in New York

.