NEW YORK (CNNMoney.com) -- Wall Street ended a bumpy first quarter with a thud last week and is bound to start the second one in a similar fashion--with Iran, China, and mostly the U.S. economy in focus.
Stocks slumped last week after reports showed a big decline in new home sales and weaker consumer confidence. Then Federal Reserve Chairman Ben Bernanke told Congress that the economic outlook has become more uncertain lately.
After that, investors weren't terribly receptive to the end of the week economic news, including stronger than expected reads on fourth-quarter GDP growth and manufacturing.
Stocks are likely to follow the trend of the economic news in the week ahead too, said Donald Selkin, director of research at Joseph Stevens.
"The earnings don't really start until later in April, so next week you'll continue to see the market sensitive to the economic reports," Selkin said.
Reports on manufacturing, auto sales, factory orders and the services sector of the economy dominate the early part of the week. Meanwhile, what is likely the most crucial report of the month for investors - the March employment report - doesn't come out until Friday, when stocks don't trade.
Although bond and commodities markets see a shortened day, stock markets are closed on Good Friday.
Oil prices should play a big role in stock trading again this week, after crude surged last week on worries about the ongoing conflict with Iran, the No. 4 oil exporter.
Also a factor: Friday's news that the U.S. is reversing a decades-old policy and will begin imposing tariffs on some goods from China, a decision that sent the dollar lower on questions about the potential for a trade war.
With all these issues in play, next week is "going to be challenging," said Art Hogan, chief market analyst at Jefferies & Co. noting that trading volume is bound to be lighter and volatility higher due to the impact of the holiday.
"It's the kind of week where everyone packs all the work in during the first three days and then mails it in on Thursday before the holiday," Hogan said.
Although last week was a downer, it also marked the end of a mixed quarter, in which the Dow ended lower and the Nasdaq and S&P 500 ended a bit higher.
The rally seemed to be progressing in the first half of the quarter, but then hit a snag in late February when a big selloff in Shanghai markets triggered the biggest one-day point loss on the Dow in over five years.
After that, investor confidence seemed to be shaken and March was a month of greater volatility, with the Dow often up 100 one day, down 100 the next.
"The market is in a stalemate right now where's there's just enough growth to frustrate both the bulls and the bears, and to keep the Fed from moving one way or the other," said James Awad, president at Awad Asset Management.
"There's too much growth to make the bears happy and not enough growth to make the bulls happy," Awad said.
Although he said he thinks the second quarter is likely to be nearly as choppy as the first, it could be a little bit better, depending on the earnings reports.
The number of companies issuing earnings pre announcements will intensify in the first few weeks of the second quarter. By later in April, the actual reports will start arriving.
S&P 500 earnings growth is expected to slow to under 5 percent in the first-quarter, after 14 quarters of double-digit profit growth.
However, the slowdown is widely expected and that could actually be a good thing for stocks.
Typically reported earnings beat the forecasts. Odds are the first quarter results will be no different, Awad said. And that should help the market regain its footing later in the quarter.
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