Next week, investors will pore over data they hope will contradict the mostly negative U.S., China and Europe reports out in the past week, and serve as a beacon for a good first-quarter earnings season.
They will be particularly interested in U.S. housing data, with pending home sales on Monday and Case-Shiller home prices on tap for Tuesday. Plus, there's U.S. durable goods orders on Wednesday.
They will also keep ears to the ground for any outlook changes ahead of first- quarter earnings reporting season, which gets going in the next few weeks.
The estimates for first-quarter performance are far from stellar. Analysts with FactSet Research expect earnings to fall 0.2% for the companies listed on the S&P 500 (SPX) .
If it comes to pass, it will be the lowest growth rate since the third quarter of 2009. FactSet projects industrials, financials, and information technology as the only sectors seeing growth for the quarter.
Analysts at Thomson Reuters said that as analysts downgraded first-quarter earnings estimates, the materials sector suffered the worst revision. Wall Street now expects the sector to report a 15% fall; in January they had forecast a 2.2% drop.
On tap for next week are earnings for electronics retailer Best Buy Co. Inc. (BBY), pharmacy chain Walgreen Co (WAG), homebuilder Lennar Corp. (LEN), and for-profit school provider Apollo Group (APOL).
Economic data pointers also include an index gauging manufacturing activity in the Chicago area in March, March consumer sentiment, and February consumer spending, all due Friday.
Many U.S. Federal Reserve officials are scheduled to speak, including Chairman Ben Bernanke on Monday, Tuesday, and Thursday, and New York Fed President William Dudley, testifying in Congress on Tuesday.
Weekly losses; not for Nasdaq
On Friday, the Dow Jones Industrial Average (DJI) ended the week down 1.2% at 13,080.73. The S&P 500 (SPX) ended Friday posting a 0.5% weekly loss, while the Nasdaq Composite (RIXF) bucked the trend to notch weekly gains of 0.4%.
The mild losses didn't faze investors.
"We've come a long way since the lows of October," and the market did it in an almost straight upward line, said Michael Jones, chairman and chief investment officer at Riverfront Investment Group in Richmond, Va. "It is not too surprising it's time for a little pause" in a red-hot market.
For the month, the indexes are up 1% to 3%. For the quarter, they've rallied 7% to nearly 18%, led by the Nasdaq Composite.
Jones said the market is unlikely to experience the high volatility seen in the last couple of summers.
In addition to the housing and consumer data due next week, investors will be keen on any reports out of China or about China, he said.
News that China's manufacturing had slowed, on the heels of comments by a mining company officer that the country was not expected to consume as much iron ore, contributed to derail equities and most commodities this week.
Chinese officials and HSBC are schedule to release their separate reports on manufacturing activity next Saturday.
The hopes of most investors are pinned on more daring Chinese officials, Jones said.
People want to see China "getting bolder and more aggressive in fighting the slowdown," he said. There's some worry authorities there may be moving too slow to prevent a hard landing, Jones added.
More on housing
Meanwhile, positive events from the week included a decline for initial jobless claims, and a rise for housing permits and multifamily housing starts. and
A "little affirmation" the housing market continues to heal is also front and center in investors' minds next week, said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
The uneven data flow this week "was enough to rattle markets a little bit," he said. People want to see "more of the same, which is some accumulating evidence that things are improving somewhat," Luschini said.
Since the past week left markets more vulnerable, however, the week ahead could have a pullback in store, he added.
On the other hand, as the end of the quarter approaches, some amount of " window dressing" -- the practice of catching up with winner stocks as the quarter finishes so the names will be on letter to investors -- is to be expected. That could provide a small boost to equities in the week to come.
Hedge funds that have underperformed will feel the pressure to do some window dressing, said Phil Orlando, chief equity market strategist at Federated Investments in New York.
Retail investors, somewhat burned by the selloff in fixed income this quarter, may also feel forced to seek better luck in stocks, he added. Any boosts to stock performances in general, however, are likely to be just "incremental," Orlando said.
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