October 12, 2025

Markets are buzzing as big American banks prepare to report their quarterly earnings, and everyone wants to know what these numbers say about the health of the US economy. Why the big fuss? Because the government shutdown has stopped new economic data from coming out, leaving investors searching for clues elsewhere. The recent week was a roller coaster! Stocks dipped on Friday after President Donald Trump's remarks increased worries about trade with China. This drop happened just before the S&P 500's bull market turns three years old. Experts like Matthew Miskin from Manulife John Hancock Investments remind us, "At the end of the day, it's going to come back to the economy ... It's going to come back to corporate profits, and earnings season is right around the corner." With US stock prices near their highest in five years, and some excitement around tech and AI stocks, the upcoming earnings season is make-or-break. Will profits be strong enough to keep the market’s climb alive? Despite Friday’s stumble, the S&P 500 is still up over 11% for the year and close to its all-time peak. Garrett Melson from Natixis Investment Managers Solutions said, "The market just keeps grinding higher. The key underpinning of that is stronger earnings outlooks. ... When you look at the fundamentals, things continue to look good." This week, big players like JPMorgan, Goldman Sachs, Wells Fargo, and Citigroup will share their results on Tuesday. Bank of America and Morgan Stanley will follow on Wednesday. These banks give a special view into the economy, says Irene Tunkel of BCA Research: "If we see that consumers are still spending, if we see that demand for loans is improving, then I will start to think that perhaps we're not really edging towards contraction." Other big names reporting soon include Johnson & Johnson and BlackRock. Experts expect S&P 500 companies to have grown earnings by 8.8% from last year in the third quarter. Chuck Carlson of Horizon Investment Services warned, "A lot of the bullishness is built around the expected earnings growth. If we start to see cracks in that, that would not be good for the market in general." Meanwhile, the government shutdown that started on October 1st keeps hanging around. So far, markets have mostly ignored it, but experts warn the longer it lasts, the bigger the risk to the economy. The shutdown has also delayed important economic reports like the October employment numbers and the consumer price index. Michael Pearce from Oxford Economics said, "With much of the regular economic data unavailable during the shutdown, the data fog is thickening." So, investors are juggling lots of uncertainty – from trade fights and a government halt to the all-important bank earnings. Will profits save the day and keep markets glowing? The countdown to earnings season has begun, and all eyes are wide open!

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Tags: Bank earnings, Us economy, Government shutdown, Stock market, Trade tensions, Corporate profits,