Welcome to “The Week Ahead” where we take a moment to provide our thoughts on what we can expect in markets and the economy during the upcoming week.

We’ve all heard the phrase, “April showers, bring May flowers”.  Did you know that that phrase is actually an excerpt from a poem called Five Hundred Points of Good Husbandry written by English poet (and farmer) Thomas Tusser in 1557? I had always wondered where that phrase came from and it makes perfect sense as Thomas Tusser lived in England, where it’s always rainy! This past week kicked off week one of earnings season for the first quarter of 2018 with about 12% of the companies in the S&P 500 having reported so far. In much needed relief, investors are once again looking at company earnings and putting a lot of the headline risk (trade wars… or are they really more trade skirmishes?) on the back burner. This is also the first time we’ll begin to see the impact of the tax reform on company results. This coming week about 15% of S&P 500 earnings will be reporting, and continuing with what we saw on Friday, a large amount of financials and banks will be reporting which should serve as a proxy for the health of the consumer and the economy. As of last Friday’s market close, the S&P 500 is now up 0.66% for the quarter. With employment close to full capacity, inflation slowly inching up to the Fed’s target, favorable company earnings should reaffirm that the underlying economy continues to remain firm. Going back to “Swéete April showers, Doo spring Maie flowers” (which is the official old English version, now translated as “Sweet April showers, Do spring May flowers”), I’m reminded that even as unpleasant events occur, they could also bring positive results in the end. I’m also reminded of the lesson of patience (which is especially important for investors): flowers don’t grow overnight.   

It will be a quiet week ahead in terms of economic data releases. Investors should keep an eye on the various housing reports as increased construction activity could further add to economic growth in 2018.

Data deck for April  14 – April 20: