E Critical Week For The Market

The stock market is heading into its most exciting, and potentially most volatile, week so far this year as earnings season picks up the pace and the Federal Reserve convenes its first meeting of 2018.

The combination of corporate results and the Fed could increase volatility in a market that has largely remained tranquil even as it continues to set fresh records and hit new milestones.

Of the S&P 500 companies that have reported, 80% have beaten estimates on EPS while 82% have surpassed top-line revenue expectations. This is the best earnings season over the past 5 years and optimism continues to push markets to all-time highs.The updated graph below confirms the rally is broad-based across virtually all of the S&P sectors, with only utility stocks lagging. We advise using stop-losses and/or other hedging strategies to lock in gains at such lofty price levels.