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KB Home Earnings, Winnebago, Powell Testimony: 3 Things to Watch

By Liz Moyer

Investing.com -- Stocks rallied broadly on Tuesday after a holiday weekend in the U.S. as investors tried to put last week's rout in the rearview mirror.

The fear of a recession ahead continues to linger but investors were able to shake off the worst of it, pushing technology and other sectors higher to start the week. Generally, there is support for another interest rate hike by the Federal Reserve next month in the neighborhood of 50 to 75 basis points, according to Richmond Fed President Tom Barkin. That would match last week's 75 basis point hike as the central bank tries to tame inflation.

There will be more interest rate/recession talk this week as a series of speakers from the Fed make public appearances, including Chair Jerome Powell himself, when he makes his periodic appearance in Congress to talk about the state of the economy.

Earnings season has wound down for the most part ahead of the July 4th holiday in a couple of weeks. Until then, only a trickle of reports are due out. But the spigot opens once again in July, and investors will be listening to what executives say about the second half of the year.

Already on Tuesday, Target (NYSE:TGT) shares got a lift when the retailer's CEO appeared on a panel at the Economic Club of New York to say it sees a strong second half.

Target and other retailers will be competing with e-commerce giant Amazon.com (NASDAQ:AMZN) next month when it launches its Prime Day annual sale-a-thon.

Here are three things that could affect markets tomorrow:

1. KB Home earnings

Home builder KB Home (NYSE:KBH) reports earnings on Wednesday. Analysts expect it to report $2.04 in earnings per share on revenue of $1.6 billion.

2. Winnebego earnings

For those with a home-away-from-home, Winnebago Industries Inc (NYSE:WGO) also reports earnings tomorrow. The RV maker is expected to report earnings of $2.96 a share on revenue of $1.2 billion.

3. Powell testimony

Fed Chair Jerome Powell will testify about the state of the economy in the Senate on Wednesday, beginning at 9:30 AM ET. Analysts expect he will be questioned extensively about inflation, economic policy and the decision to raise rates by 75 basis points.

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