Focus on Earnings, Greenspan Comments

Wall Street kicks off one of the busiest weeks of the earnings season today, with about 178 companies in the Standard & Poor’s 500 index scheduled to report first-quarter results.

Nearly three-quarters of the S&P; 500 companies that have reported results have beaten expectations, and 11% have come up short, according to Thomson First Call.

But with the S&P; 500 up nearly 42% from the 2003 low hit 13 months ago, some investors are hesitant. They say results will have to be stellar to keep many stocks moving up.

“The market wants to be surprised to the upside, and that really is going to be the key going forward as the majority of companies report,” said John Lynch, market analyst at Evergreen Investment Management Co.

Particularly crucial, Lynch added, will be what managements say about the future: “It’s what they say going forward, how they are projecting the second quarter and full year.”

Investors will also be watching Washington, where Federal Reserve Chairman Alan Greenspan is scheduled to testify before Congress on Tuesday and Wednesday. In the wake of last week’s government report that inflation rose at a 5.1% annualized rate in the first quarter, investors will be studying Greenspan’s comments for indications as to when the Fed might begin to tighten credit.

Weekly figures on initial claims for unemployment benefits, due Thursday, are expected to slip to 340,000 from 360,000 the previous week, according to economists polled by Reuters.

A report on durable goods is on tap Friday, with economists expecting it to show that orders for manufactured goods such as refrigerators rose 0.8% in March after a 2.5% gain in February.