Quarterly Reports To Show How Companies Are Handling Inflation, COVID

This week, some of America's largest companies will release their financial reports from the last three months.

Around 984 companies will reveal their profit picture over the next couple of weeks, including Apple, Visa, Chevron and many more. 

Those reports will show how companies are navigating issues like inflation, rising COVID-19 cases and the continuing supply chain snarls.

These financial statements will also provide insight to corporate investment, worker pay, hiring and will have an impact on your 401k. 

Airlines have faced some of the biggest challenges from the pandemic. While major airlines like Delta are expected to post a loss again over the last quarter, it should at least be a lot smaller than it was a year ago.

Economists expect big Wall Street banks like JPMorgan Chase and others  to post a near 10% rise, while the entire market itself is expected to post a near 22% year-on-year increase.

The groups expected to show the biggest gains are the inflation hedges — energy, material and industrial sectors. Those three groups are the only ones expected to exceed the growth for the S&P 500. All other sectors within the index are expected to post returns that are lower.

The Omicron concern isn't expected to have as big of an impact on these financial reports because we really didn't see a ramp up in the number of COVID cases until the end of December. That will have more of an impact on the first quarter 2022 reports.

Inflation is a more significant concern as the U.S. just saw a 7% rise in the consumer price index over the past year and investment strategist Sam Stovall doesn't believe the worst is behind us.

"I think we're going to peak at about 7.3% year-on-year rise in inflation in February," he said. "So we could have more challenging numbers to contend with in the months ahead."