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Earnings season is a critical test for a stock market on the road back to a record

Earnings season is a critical test for a stock market on the road back to a record

  • The big banks are the first wave of companies to report third quarter earnings, a critical test as stocks attempt to regain highs.
  • Analysts are watching to see if companies are more forthcoming with guidance, which many abandoned after the virus-related shutdowns.
  • JPMorgan reports Tuesday, and it is the bellwether traders are watching to see if its stock can break higher.



a group of people standing in a room: Traders wearing masks work, on the first day of in person trading since the closure during the outbreak of the coronavirus disease (COVID-19) on the floor at the New York Stock Exchange (NYSE) in New York, U.S., May 26, 2020.


© Provided by CNBC
Traders wearing masks work, on the first day of in person trading since the closure during the outbreak of the coronavirus disease (COVID-19) on the floor at the New York Stock Exchange (NYSE) in New York, U.S., May 26, 2020.

The big banks start off third quarter earnings season, and investors will be most focused on guidance to see if earnings can propel the market back to its highs.

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The S&P 500 closed at 3,534 Monday, about 1.5% from its previous high.

Banking bellwether JPMorgan reports Tuesday morning, as do Citigroup and BlackRock.

Delta Airlines and pharmaceutical maker Johnson and Johnson also report Tuesday. Bank of America, Goldman Sachs, Wells Fargo and PNC release earnings Wednesday.

“The bank stocks haven’t done anything in nine months. If JPMorgan is solid, and traders can’t sell it down, the banks could help take S&P to the highs of the year,” said Scott Redler, partner with T3Live.com. He said technically the market is in good shape, with big tech taking the lead Monday after a rest last week, but a broad group of stock also participated in the rally.

“JP Morgan has critical range resistance at $105 to $107. If it could get above that, it could open the door for a better move in to year end,” said Redler.

Analysts say they are looking for much more in the way of guidance this quarter, after many

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