NEW YORK (CNNfn) - Trick or treat on Wall Street could yield yet another ghoulish ride for U.S. stocks this week as the volatility continues and the race for the White House enters its final week.
With a big chunk of the major corporate results out of the way, investors will turn their attention to economic data and poll indications about which presidential candidate is gaining ground.
"We're going to be winding down (earnings) and more focus will be turning toward the presidential election," said Bill Meehan, chief market analyst at Cantor Fitzgerald. "However, there's not much one can do since the race appears too tight to call. On a poll-by-poll basis, you could see drug stocks impacted negatively or positively, with tobacco stocks and defense stocks similarly impacted."
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Investors are still reeling from the wild swings over the past couple of weeks that were sparked by disappointing corporate results sending stocks plummeting with positive results helping soften the blow.
"The focus will shift from earnings to the presidential election," said Peter Cardillo, director of research at Westfalia Invesments. "We're in this last part of earnings reporting and most of the damage has already been done. There's not one sector that has not been raided."
Last week's wacky Wall Street
Investors hoping for a slowdown to the speeding roller-coaster ride called the U.S. stock market were sorely disappointed last week.
The Dow Jones industrial average managed to ride high as several of its components posted strong quarterly earnings. The blue chip index also gained support as skittish investors headed to the tech stock exit door, betting that some of the 'old economy' stocks would provide a safer haven for their money.
The Nasdaq composite index went back into 'sell' mode as the price of technology stocks remained murky, with investors still signaling some overvalue in the tech sector.
"There are still too many people that have let greed remain in control and have yet to succumb to fear. There are too many people calling bottoms all over the place," said Meehan. "People are too worried about missing the v-shaped recovery than they are about losing money and losing it they have been."
A perfect example came last Wednesday when the Nasdaq plunged nearly 6 percent after Nortel Networks (NT: Research, Estimates) posted a revenue shortfall. Nortel, which trades on the New York Stock Exchange and the Toronto Stock Exchange but not on the Nasdaq, sent Nasdaq tech issues tumbling.
The Dow finished the week at 10,590.62, 3.5 percent higher than it closed the previous Friday. The Nasdaq, however, lost a solid 5.9 percent on the week, closing at 3,278.36. The S&P index shed 1.2 percent on the week, ending at 1,379.58.
The major U.S. indexes could gain some support this week, mainly because heavy selling often provides pockets of buying opportunities.
"I think the market is going to rally right around election time because of a very oversold condition," said Brian Finnerty, managing director at C.E. Unterberg, Towbin. "We have a market that is way oversold so I think it is going to bounce."
Enter the data
With most analysts expecting no change to interest rates by the Federal Reserve's monetary policy-making body, there are still two meetings to go this year, with the next one just one week after the election.
Investors will keep a close eye on economic data to gauge whether or not the Fed will make a move on rates, especially in light of last week's key report on the Employment Cost Index (ECI) and the Gross Domestic Product (GDP).
 After six interest rate hikes since June 1999, most of the incoming economic data has been pointing to a slowing economy. This has calmed some of the skittishness harbored by investors who worried that more rate hikes could hurt their investments.
On the economic front this week will be reports about consumer confidence, productivity, unemployment and manufacturing.
 On Wednesday, the National Association of Purchasing Management (NAPM) will report its index of manufacturing activity for October. Analysts said the "prices paid" component, which indicates what producers paid for materials, would be closely monitored. Higher costs tend to result in higher retail prices as the costs get passed on from producer to consumer.
According to analysts polled by Briefing.com, the NAPM for October is expected to slip to 49.5 percent from 49.9 percent in September.
Click here for a full economic calendar
In the week's other key economic reports, consumer confidence is expected to slip to 140 from 141.9, according to analysts polled by Briefing.com. Consumer spending powers two-thirds of the U.S. economy so economists tend to keep close tabs on anything that signals a change in consumer attitude.
Also on tap will be a report on October's unemployment rate, which is expected to rise to 4 percent from September's 3.9 percent, according to analysts.
 Another key economic report comes on Thursday when third quarter productivity will be reported. Analysts polled by Briefing.com expect a sharp drop to 3.5 percent from the previous 5.7 percent.
This could unnerve investors since Federal Reserve chairman Alan Greenspan has consistently said productivity must remain high for inflation to stay under control.
"Mr. Greenspan is probably on record at least a dozen times over the last couple of years stating that a continuing rise in productivity will be required in order to keep inflation in check - not even a sustainably high rate is enough so that could unnerve people," said Cantor Fitzgerald's Meehan.
Corporate results winding down
Investors are just hoping to get through the rest of the reporting season without any severe surprises and they are headed for the home stretch.
After a rocky week on Wall Street, sparked by some disappointing technology earnings and most notably Nortel's (NT: Research, Estimates) revenue shortfall, JDS Uniphase (JDSU: Research, Estimates) helped revive the market somewhat Friday after it reported surprisingly strong fiscal first-quarter results.
Nearly all of the 30 Dow components have already reported and most of the large cap tech issues on the Nasdaq have also already posted results.
Click here for a full earnings calendar
According to First Call/Thomson Financial, 360 of the 500 companies on the S&P 500 have reported and 72 percent have beat expectations by 3.4 percent, compared with an average 3 percent over the last six years.
 But stocks have been battered by a hefty negative pre-announcement season, with 81 companies, or 16 percent, in the S&P 500 announcing negative rhetoric ahead of quarterly results.
"This is the largest number of S&P 500 companies pre-announcing for any quarter in the last five years," wrote First Call research analyst Anthony Crooks, in a research note. "Once again, the punishment of missing or pre-announcing earnings has been overwhelming on companies stock prices."
 In upcoming corporate events, Prudential Securities will hold a technology conference in New York from Monday through Wednesday, Intel's executive webcast will take place on Wednesday, and Bear Stearns will host a global communications conference in New York Wednesday through Friday. 
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