1. High-flying stocks: The hype has been building for months. Now Amazon and the four leaders of the scorching-hot Dow will have to deliver.
The stock market boom has raised the bar for the dozens of companies reporting quarterly numbers this week. Much of the spotlight will be directed towards Amazon, the $475 billion Jeff Bezos juggernaut that seems to be on top of the world right now.
Wall Street has also showered love on a foursome of big American brands whose shares have soared more than 33% this year: Boeing, McDonald's, Visa and Caterpillar. All four will have to justify those big gains when they post results this week.
Amazon (AMZN) is so hot right now that major cities in the U.S. and Canada are falling over themselves just to get the e-commerce giant to build its second headquarters there. Like city officials, investors are in awe of Amazon's ability to disrupt entire industries.
Mere rumors of Amazon moving into new businesses send shudders through Wall Street. Just look at the selloff in pharmacy stocks sparked by talk of Amazon taking on prescription drugs. Ditto for shipping. That's on top of the pain inflicted on grocery chains by Amazon's shocking Whole Foods takeover.
Amazon's success has left expectations very high. The online retail giant is trading at a very lofty 139 times projected earnings. That makes Amazon vastly more expensive than tech darlings like Apple (AAPL) and Facebook (FB). It's even pricier than Netflix (NFLX).
Boeing (BA) has flown to even greater heights than Amazon this year, soaring 67% to the top of the Dow. It's benefiting from a boom in defense stocks caused by President Trump's push to boost military spending and because of concerns about North Korea. Boeing is also enjoying solid orders for its new 737 MAX and 787 Dreamliner commercial jets.
Caterpillar (CAT) is digging out of a big hole caused by the commodities crash. The machinery maker's stock has more than doubled since early 2016 thanks to stabilizing oil and metals prices as well as accelerating global growth. Deep cost cuts, including layoffs, by new CEO Jim Umpleby have also stabilized the business.
McDonald's (MCD) is another Dow comeback story. Wall Street has devoured McDonald's stock since Steve Easterbrook took over, promising to turn it into a "modern and progressive burger company." The image change and menu additions like the Signature Crafted sandwich line have successfully lured customers back to the burger chain.
Visa (V) continues to cash in on the shift away from paper currency towards electronic payments. Visa card usage has grown substantially in recent quarters, including overseas. It also helps that Visa is the network used by popular rewards credit cards like the Chase Sapphire Reserve card.
2. GDP estimate: The Bureau of Economic Analysis will release an advance estimate of third-quarter GDP gains on Friday. Last quarter -- the first full quarter under President Trump -- the economy grew by 3.1%. That squares with the administration's goal of 3% growth, a lower target than the 4% Trump promised on the campaign trail.
Overall, the U.S. economy has been doing well. Last quarter's gains marked the fastest quarterly growth in two years, and the September jobs report revealed that average hourly wages have gone up by 2.9% over the past 12 months. Unemployment hit a more than 16-year low of 4.2%, and this month the stock market surged past 23,000 for the first time. More good news could come on Friday.
3. ExxonMobil and Chevron report earnings: The country's two biggest oil companies are both revealing their third-quarter earnings on Friday.
While many companies have soared on Wall Street this year, Big Oil has been struggling. Exxon (XOM) shares have fallen by more than 8% in 2017, and Chevron (CVX) has inched up by less than 1% over the course of the year.
It's been a rocky few months for the pair. A Harvard study published in August found that Exxon "misled the public" on climate change for nearly 40 years. And that month, a number of Exxon's refineries -- including its Baytown refinery, the second largest in the country -- went offline because of Harvey.
In September, San Francisco and Oakland filed lawsuits demanding that Exxon, Chevron and other companies pay billions to protect the coastal cities from rising sea levels. The following week, Chevron announced that the company's CEO will step down next year.
We'll see if they address the tumult on Friday.
4. Earnings, earnings, earnings:
Major companies across several sectors are reporting earnings next week. Toy rivals Hasbro (HAS) and Mattel (MAT) are reporting on Monday and Thursday, respectively. Tech giants Twitter (TWTR), Alphabet (GOOG), Microsoft (MSFT) and Intel (INTC) are all reporting on Thursday.
The communications industry is well represented by AT&T (T), reporting Tuesday, and Comcast (CCV), reporting Thursday. In the autos sphere, GM (GM) reports its earnings on Tuesday and Ford (F) is on Thursday. Airlines are also reporting: Southwest (LUV)'s earnings are out Thursday, as are American Airline (AAL)'s.
Hungry for more? Hershey (HSY)'s results come in Thursday, Coca-Cola (CCE)'s on Wednesday and Chipotle (CMG)'s on Tuesday.
Plus, there's Walgreens (WBA) on Wednesday, Xerox (XRX) on Thursday and Merck (MKGAF) on Friday. Phew.
5. Coming this week:
Monday -- Hasbro
Tuesday -- AT&T, GM, Chipotle, Lockheed Martin, Caterpillar and McDonald's earnings
Wednesday -- Coca-Cola, Walgreens, Boeing and Visa earnings; ECNY luncheon with Wilbur Ross
Thursday -- Mattel, Twitter, Alphabet, Microsoft, Intel, Comcast, Ford, Southwest, American Airlines, Hershey, Xerox and Amazon earnings
Friday -- ExxonMobil, Chevron and Merck earnings; GDP Q3 estimates
