New earnings season to hint at how Covid-19 will weigh on big firms

Earnings for energy and industrials sectors are expected to have declined the most of all sectors in the fourth quarter.

Citi, and other big US banks, start the 2021 earnings season this week. Picture: Mark Lennihan/AP

Investors will be anxious to see whether upcoming quarterly reports and outlooks from US companies validate expectations for a strong 2021 rebound in earnings and the global economy, which were ravaged by the coronavirus pandemic last year.

US stocks are at record highs, boosted largely by optimism that the rollout of vaccines to fight the Covid-19 virus will allow for that recovery, while hopes of more fiscal stimulus under US president-elect Joe Biden have also underpinned the market.