Equity markets were mixed on Tuesday as investors brace for an onslaught of earnings reports. The bulk of S&P 500 companies will report earnings over the next 4 weeks and provide a deep look into the state of the economy. The expectation is for earnings growth to resume; the question is how inflation and high-interest rates impact the outlook. If the S&P 500 performs better than expected but guidance is lowered, the market is likely to fall.


The S&P opened lower on Tuesday but moved higher early in the session. However, the advance was capped below 4,400, the critical line to cross. If the market can not get above that level soon, another correction is likely. The sell-off could become profound if the correction coincides with poor guidance or other bad news. Other potentially bad news on the horizon is the September read of PCE prices and the upcoming FOMC meeting.