Week Ahead: US Stocks Need Boost From Earnings to Keep Rally Going

CNBC.COM | October 02, 2009 | 6:52 PM EDT

Uneven economic news is spooking stocks this October, but third quarter earnings could be one factor that helps keep the market's 7-month rally intact. Expect the going to be choppy though. October markets are always haunted by a volatile past, and this market is showing it is sensitive to a string of weaker than expected economic data, including Friday's September jobs report. Mostly, Octobers are not terrible, but some of the worst crashes have happened in October. Historically, Octobers have been positive about two-thirds of the time when they follow a positive September.

In the week ahead, there is little economic data, so commentary from companies ahead of third quarter earnings reports will carry extra weight. Alcoa [AA 12.82  -0.10 (-0.77%)]releases its earnings Wednesday after the bell, kicking off third quarter reporting season, but the big rush of quarterly reports does not start until the following week. Important also will be chain stores' September sales reports on Thursday.

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