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Before the Bell: The U.S. stock market is sitting near record high ground, as we commence a new week on Wall Street. Investor sentiment remains relatively positive, reflecting an improved outlook for the economy and a healthier corporate sector. However, the Delta variant of the coronavirus is starting to create sizable challenges in parts of the country, and this is of some concern. Overnight, the international markets delivered a mixed session. In Asia, the Nikkei managed to stage a healthy advance. In Europe, the FTSE 100 has been trading lower. On our shores, the S&P futures are currently off about seven points, suggesting a soft start to the trading day.

In economic news, there will be a number of important items released this week. Today, we get a look at the new home sales figures for the month of June. This report will likely receive some attention, given the critical role that the housing market plays in the broader economy. On Tuesday, the latest monthly durable goods orders and the consumer confidence numbers are scheduled to be released. Finally, on Wednesday, the FOMC concludes its two-day meeting with an interest-rate decision and some prepared remarks. Although inflation is still a concern, some economists believe that the current situation is transitory and will gradually stabilize. Most traders are not expecting any changes to monetary policy at this time.

In the corporate arena, the second-quarter earnings season has been progressing nicely. Among the large publicly traded companies, the vast majority have posted results that have surpassed analyst expectations. This week, we will hear from numerous leading technology names, including Apple (AAPL), Amazon (AMZN), and Facebook (FB). Of note, many technology businesses saw an uptick in demand at the onset of the coronavirus pandemic. Investors will want to see this strength continue now that the environment has stabilized.

Technically, the stock market staged a pull back about two weeks ago, but quickly regained its footing. It was encouraging to see traders step in to buy equities, as this suggests that there is ample capital on the sidelines waiting to enter the market. Last week’s rally put the S&P 500 Index back to record high ground, but it remains to be seen if the bulls can push the market higher from here. Equity valuations seem stretched, in our view. Consequently, it will be critical that companies meet expectations and provide upbeat guidance. – Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.