Earnings are expected to be lousy, but the market may not care

Keon said there are risks, including whether there really is a trade deal with China over the next couple of weeks and whether China’s economy is really bottoming. “Is the success of China’s stimulus gong to to continue and spread to other countries? To me, the picture is much brighter than it was a couple months ago,” he said.

Strategists said any number of factors could be the catalyst to push stocks to records, including earnings season, if companies beat lowered guidance and their outlooks are good. Stocks could also ride higher on a better outlook for the U.S. economy, after a batch of better data including Friday’s March jobs report.

“I think maybe we end up getting to a new high sometime early in the second quarter, and then maybe we do some sideways moving in that ‘sell in May’ period,” said Sam Stovall, chief investment strategist at CFRA. “I think we confirm that 10th anniversary of this bull market by hitting a new all-time high. Then we digest some of those gains and move sideways for a bit and let some of those earnings catch up, and then maybe there’s a year-end advance.”

Also in the week ahead, investors are watching for the minutes from the Fed’s last meeting, scheduled to be released Wednesday afternoon. At that meeting, the Fed released revised forecasts, with no rate hikes now expected in 2019 and a slower growth outlook. The minutes should also show what Fed officials were considering when they decided to end the program to roll down their balance sheet, and bond traders are looking for clues on which type of Treasurys the Fed will hold in its balance sheet.

On the data front, there are CPI consumer inflation data Wednesday and producer price inflation on Thursday. Both of these indexes should be closely watched since wage gains were muted in Friday’s March jobs report, and strategists said they see no sign of inflation on the horizon. The Fed also sees below-trend inflation, so any unexpected change would be important.

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David KennyA worker assembles an industrial valve at Emerson Electric's factory in Marshalltown, Iowa, July 26, 2018.