Here are the 3 big things we're watching in the stock market this week

The S&P 500 is nearing record highs, with market focus this week on critical economic data, Federal Reserve insights, and major corporate earnings. Delayed September employment and real earnings reports, crucial for assessing economic health post-government shutdown, are due. Concurrently, minutes from the October Fed meeting, which saw a 25 basis point rate cut, will be released, influencing market expectations for a December cut, now at 46% amid Fed apprehension. A busy earnings schedule includes Home Depot, TJX Companies, Palo Alto Networks, and particularly Nvidia, whose guidance on AI chip production and long-term sales outlook is highly anticipated, against a backdrop of strong Q3 S&P 500 earnings showing 13.1% blended EPS growth.

Analysis

The S&P 500 is trading just over 2% below its record high, reflecting a moderately positive market sentiment despite initial November volatility. This week's market focus centers on the release of delayed September employment and real earnings data, crucial for assessing economic health post-government shutdown, as some Federal Reserve officials are reportedly hesitant to act on monetary policy before reviewing them.

Minutes from the October Federal Reserve meeting, which included a 25 basis point rate cut, are anticipated to provide further insight into the central bank's stance. Market expectations for a December rate cut have softened, with the CME FedWatch tool indicating only a 46% probability, driven by recent apprehensive statements from Fed officials, contrasting with some analysts' views that a cut is warranted due to economic slowdown.

Q3 earnings season has largely concluded with strong results, as 82% of S&P 500 companies reported positive EPS surprises and 76% positive revenue surprises, contributing to a blended year-over-year EPS growth rate of 13.1%. This week features critical earnings from Home Depot, TJX Companies, and Palo Alto Networks. Nvidia's report is highlighted as the most important, with market attention focused on its guidance, particularly CEO Jensen Huang's $500 billion sales visibility through 2026 and updates on the Rubin AI chip production ramp.

Home Depot's outlook on 2026 interest rates and their impact on housing and renovation activity will be key, alongside tariff updates. TJX Companies is positioned as a holiday season winner due to its value proposition amid "cracks in consumer buying power," making management's comments on inventory quality important. Palo Alto Networks' "platformization strategy" appears effective, with investors keen on insights regarding government shutdown implications and the CyberArk acquisition.

Key Decisions for Investors

• Investors should closely monitor the delayed September employment and real earnings reports for their potential impact on Federal Reserve monetary policy decisions, particularly regarding a December rate cut.
• Evaluate Nvidia's (NVDA) guidance on AI chip production and long-term sales visibility, and TJX Companies' (TJX) commentary on consumer buying power and inventory quality, given their positive sentiment.
• Exercise caution with Home Depot (HD) due to its lower sentiment score and sensitivity to 2026 interest rate outlooks, while assessing Palo Alto Networks' (PANW) updates on its platformization strategy and government shutdown implications.