The third-quarter earnings season picks up the pace in the coming week with S&P 500 heavy-hitters on the calendar. Nearly one-fifth of S&P 500 companies are set to report earnings in a jam-packed five days.
Expectations for S&P 500 companies have so far been muted with continued troubles for the energy sector dragging average earnings into another decline. S&P 500 companies are expected to report their fifth quarter in a row of earnings declines, a recession not seen since 2009.
Some analysts believe investors are being too bearish on how S&P 500 companies performed over the recent quarter.
"Looking forward, what I see is the very real possibility that Q3 earning season will likely come in better than the lowered analyst expectations which are calling for a decline in earnings by 2.3%," said Robert Pavlik, chief market strategist at Boston Private Wealth. "Analysts for the past several quarters have underestimated and corporations have repeatedly beaten the lowered forecasts. I expect this trend to continue in Q3."
On the earnings calendar in the coming week, Bank of America (BAC - Get Report) will report on Monday; UnitedHealth (UNH - Get Report) , Phillip Morris (PM - Get Report) , Goldman Sachs (GS - Get Report) and Blackrock (BLK - Get Report) on Tuesday; Dover (DOV - Get Report) , Halliburton (HAL - Get Report) and Morgan Stanley (MS - Get Report) on Wednesday; Travelers (TRV - Get Report) on Thursday; and Honeywell (HON - Get Report) and General Electric (GE - Get Report) on Friday.
In tech, Netflix (NFLX - Get Report) and IBM (IBM - Get Report) will report on Monday; Intel (INTC - Get Report) on Tuesday; eBay (EBAY - Get Report) and Seagate (STX - Get Report) on Wednesday; Verizon (VZ - Get Report) , Microsoft (MSFT - Get Report) and Advanced Micro Devices (AMD - Get Report) on Thursday.
In the consumer sector, Hasbro (HAS - Get Report) will report on Monday; Johnson & Johnson (JNJ - Get Report) and Harley-Davidson (HOG - Get Report) on Tuesday; Mattel (MAT - Get Report) and American Express (AXP - Get Report) on Wednesday; Walgreens (WBA - Get Report) and Dunkin' Brands (DNKN - Get Report) on Thursday; and McDonald's (MCD - Get Report) on Friday.
The presidential election will also be on the radar with the third and final debate set for Wednesday evening. Democratic presidential candidate and frontrunner Hillary Clinton will join Republican presidential candidate in a debate hosted by Fox News anchor Chris Wallace. The third debate at the University of Nevada in Las Vegas will be identical to the structure of the first with both candidates discussing a range of topics over the 90-minute, commercial-free broadcast.
"The third debate marks one of the last chances for Trump to bounce back in the polls, which have widened sharply in Clinton's favor," TD Securities analysts wrote in a note. "It is unlikely to happen at this event, as his latest actions and surfacing evidence of inexcusable behavior have likely pushed Trump onto his ninth life. Nonetheless, polls can change swiftly and markets will remain wary between now and November 8."
Investors remain on Federal Reserve watch in the coming week with the latest Beige Book from the central bank providing insight into economic activity in the 12 Fed districts. The anecdotal read on economic growth over a six-week period will be released on Wednesday afternoon.
A number of central bank officials are also set to make remarks. The sheer volume of Fed commentary in recent weeks has led to volatility as traders pick apart speeches for clues as to the possibility of a hike in interest rates. Fed Vice Chair Stanley Fischer will address the Economic Club of New York on Monday; San Francisco Fed President John Williams will participate in a Q&A and Dallas Fed President Rob Kaplan will make remarks on Wednesday; and New York Fed President William Dudley will speak on the financial services industry on Thursday.
On the economic calendar in the coming week, industrial production for September and the Empire State Manufacturing Index for October will be released on Monday; the consumer price index for September on Tuesday; and the Philadelphia Fed Business Outlook Survey for October on Thursday.
The housing sector will also go under the microscope with the housing market index for October on Tuesday, housing starts and building permits for September on Wednesday, and existing home sales for September on Thursday.