Noreen Burkhart

Investing.com – The financial sector is the focus of earnings season, which kicks off in the next week. As investors wait for the Federal Reserve rate hike, earnings results will put a strain on growth stocks. Meetings are scheduled by the Bank of Japan and European Central Bank. In the U.S., markets are closed Monday due to Martin Luther King Jr. Day. On Monday, China’s GDP data could spark speculation regarding monetary ease. Here’s what you need to know to start your week.

1. Earnings

The week’s financial sector earnings will feature fourth quarter results of (NYSE.), (NYSE.) and BNY Mellon on Tuesday. They will be followed by Morgan Stanley (NYSE)

The first two big financial firms to report are (NYSE:) Wednesday and (NASDAQ.) Thursday. Investors are going to be closely watching the streaming company’s future plans, as well as its outlook for subscribers.

The ended lower on Friday, dragged down declines in major banks, including JPMorgan Chase & Co. (NYSE:) and Citigroup (NYSE): After the earnings results were released, worries over falling trading revenues and decreased loan growth have been raised.

Analysts have indicated that although bank executives may be optimistic about the future, stocks tend to do better in advance of rate rises than when rates are increasing.

2. Are you looking for growth stocks to invest in?

U.S. growth and tech stocks are off to a bad start in 2022. This raises the stakes for earnings season as investors search for reasons to be steadfast before expected Fed rate increases.

Tech investors hope that a strong earnings year can reverse declining Treasury yields. There are also expectations that the Fed will increase rates and tighten monetary policies to reduce inflation.

Investors should be aware of how much longer-term U.S. Treasury Yields are rising as the Fed increases its short-term rate. For growth stocks, higher yields will mean lower future profits.

Earnings will be an asset for these companies, considering the impressive performance of some tech-related names. Reuters was told by Walter Todd, Greenwood Capital’s chief investment officer. “The next month will show how these tech companies respond to their numbers… It’s going to be fascinating.”

3. Central banks

At the end of Tuesday’s two-day monetary policies, the BoJ will keep its policy in place and raise its inflation forecast. Although inflation has not reached the bank’s 2% target yet, more businesses have increased their prices in response to an increase in commodities costs.

The ECB will publish its December meeting minutes, in which it approved stimulus measures. This comes amid ongoing discussions about how to combat rising prices within the bloc.

The Fed is now in its usual quiet phase ahead of the Jan. 24-25 policy meeting.

4. U.S. Data

It’s set to be a light week on the U.S. economic calendar, with updates on the housing sector and regional manufacturing surveys in a holiday-shortened week.

This Tuesday’s deadline is for the and data will be available on Wednesday. Thursday’s edition of the will include updates and information on.

While the manufacturing surveys are expected to show the extent of Omicron’s impact on factory activity, the housing data will remain steady. The data are unlikely to change market expectations about a March Fed rate increase.

5. Chinese GDP

Data on Monday is expected to show China’s economy grew by an annualized in the fourth quarter – the slowest rate since the second quarter of 2020, pressured by a downturn in the property sector, curbs on debt and strict Covid-19 measures.

The world’s second-largest economy is facing multiple headwinds in 2022, including persistent weakness in the property sector and fresh restrictions on movement amid the recent local spread of the Omicron variant.

Analysts believe that policymakers will be more inclined to inject more money into the economy to counter rising interest rates. However, they may feel more pressure to ease their policies given the current economic situation.

China’s top planner asked local governments Sunday to limit the effects of COVID-19 prohibitions on the Lunar New Year holiday. This would help to boost consumption.

This was made possible by Reuters