The S&P 500 Index and its ETFs, like SPY, IVV, and VOO, remained in a tight range close to the all-time high after key earnings from some of the biggest American companies last week. They also wavered after Donald Trump announced his nominee for the Federal Reserve on Friday. This article looks at some of the top catalysts for the index this week.

S&P 500 Index to react to key earnings 

The S&P 500 Index remained slightly below the all-time high after top companies like Microsoft, Apple, and Meta Platforms published their financial results last week. 

Apple reported strong earnings but warned about the memory shortage in the industry, while Microsoft’s stock dropped after the company noted that its cloud revenue growth was slowing. Meta Platforms reported strong financial results, pushing its stock to a record high.

33% of all companies in the S&P 500 Index have published their financial results, with the blended earnings growth of 11.9%. If this is the final figure, it will mark the fifth consecutive quarter of double-digit revenue growth.

This week will see more S&P 500 constituent companies publish their financial results. The most notable ones are companies like Amazon and Google.

The others are Palantir, Walt Disney, AMD, Merck, Pfizer, PayPal, Eli Lilly, Qualcomm, Uber, ConocoPhillips, and KKR. In total, over 50% of all companies in the S&P 500 Index will publish their results this week.

There will be major corporate news, including news that Bob Eiger is considering resigning before his term ends and that the deal by NVIDIA to invest in OpenAI was on ice.

Potential US strike on Iran

The other major catalyst for the S&P 500 Index will be on geopolitics. In a statement last week, Donald Trump warned Iranian leaders to talk with the United States about ending its nuclear program. This statement was notable as Trump claimed that he completely obliterated the program last year.

Most analysts believe that Trump’s goal in Iran is purely on regime change, a move that Israel has supported for years. 

Iran has threatened that any attack from the United States will attract a major retaliation, which explains why the crude oil price has jumped in the past few weeks, with the price of crude oil soaring to $70.

The country has some notable options, including disrupting trade at the Strait of Hormuz, hitting Israel, and attacking US bases in the region.

US non-farm payrolls data 

The other major catalyst for the S&P 500 Index and its ETFs will be the upcoming macro data, which will have a major impact on the financial market.

The US will publish the latest jobs numbers on Friday. Economists expect the data to show that the economy added over 70,000 jobs in January, while the unemployment rate dropped to 4.3%.

This report comes a week after the Federal Reserve delivered its interest rate decision. As was widely expected, the bank decided to leave interest rates unchanged between 3.50% and 3.75%.

Most importantly, the upcoming report comes a week after Donald Trump nominated Kevin Warsh to become the next Federal Reserve Chair. While Warsh has supported some of Trump’s deregulation efforts, he has always been an inflation hawk.

Therefore, there is a likelihood that Warsh will become more like Jerome Powell, who promised Trump of rate cuts only for him to maintain a more hawkish view.

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