U.S. stocks were little changed on Monday as investors refrained from placing big bets ahead of a busy earnings week. Investors geared up for key quarterly earnings results of major players including Goldman Sachs Group Inc GS, Bank of America Corp BAC, Microsoft Corporation MSFT, International Business Machines Corp. IBM, Johnson & Johnson JNJ, QUALCOMM, Inc. QCOM and eBay Inc EBAY that will be released this week. Netflix, Inc. NFLX is expected to report earnings after the market closes on Monday. While the Dow and the S&P 500 ended in the red after hitting record highs on Friday, the Nasdaq was able to eke out slight gains and notched a 7-day winning streak.

For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.

The Dow Jones Industrial Average (DJI) declined a meagre 0.04% to close at 21,629.72. The S&P 500 dropped just 0.01% to finish at 2,459.14, with utilities leading advancers and health care lagging. The tech-heavy Nasdaq Composite Index, however, gained 0.03% to close at 6,314.43. Advancing issues outnumbered decliners on the NYSE by 1,702 to 1,020. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

It’s All About Earnings

Given the stock market’s record run this year, Wall Street is keeping a close eye on quarterly earnings.  This could be an excellent earnings season for the S&P 500, which in turn will boost its operating earnings per share for the trailing 12 months. Improved second-quarter economic growth, strong manufacturing and service surveys, and a moderate uptick in wage growth are expected to help Corporate America post relatively high profit margins in Q2. Earnings growth is expected to be led by energy, financials and information technology (read more: Wall Street to See Terrific Q2 Earnings: 5 Top Gainers).

According to estimates, total second-quarter earnings for the S&P 500 cohort are expected to be up 6.6% from same period last year on 4.5% higher revenues. This would follow earnings growth of 13.3% in Q1 on 7% revenue growth, the highest in at least two years. Sam Stovall, chief investment strategist at CFRA Research, further added that history shows the final tally will be better in Q2 “as actual EPS exceeded initial estimates in each of the last 21 quarters and have done so by an average of 3.6 percentage points.”

If we move beyond Q2, total earnings for the S&P 500 cohort are anticipated to increase 6.1% on 4.5% higher revenues in Q3 and gain by 9.7% on 5.2% higher revenues in Q4. For the entire year, total earnings for the index are expected to be up 7.4% on 4.1% higher revenues. This will be way more than 1% earnings growth on 2% higher revenues recorded last year (read more: Bank Earnings in the Spotlight).