1. Minting money: American companies are pulling in monster profits right now.
A combination of faster economic growth, lower taxes and soaring oil prices are padding the bottom lines of large businesses. Call it the Great American Profit Machine.
Not only are S&P 500 profits sitting at all-time highs, but first-quarter earnings are on track to surge by 24.5% -- the fastest pace since 2010, according to FactSet.
The blockbuster results even managed to blow away Wall Street's lofty expectations. More than three-quarters of S&P 500 companies -- 78% to be exact -- beat earnings estimates. That's the most since FactSet started tracking the stat in 2008.
"Companies are absolutely crushing it on earnings," said Anthony Saglimbene, global market strategist at Ameriprise Financial.
Energy companies are the biggest winners, care of vastly higher oil prices. FactSet said the sector's profits nearly doubled during the first quarter, growing at more than twice the pace of the next closest industry.
If Corporate America's results are so fantastic though, why isn't Wall Street throwing a big party? The S&P 500 is up just 2% this year, after soaring 19% in 2017.
That's because investors have shifted their attention away from the very good fundamentals to focus on a series of worries. Stocks plunged earlier this year due to fears that inflation could jump to levels that force the Federal Reserve to aggressively raise interest rates. A very strong wage growth number in Friday's jobs report renew fears of runaway inflation.
More recently, President Trump's muscular trade agenda has taken the spotlight away from the economy and corporate profits. Worries of a trade war with China have repeatedly dented stocks, though both sides have recently softened the rhetoric. Now Trump is talking about possible tariffs on auto imports.
Last week, stocks were briefly dealt a blow by geopolitics. News that Trump had scrapped the historic North Korea summit weighed on the market and raised concerns about trade talks with China.
Wall Street is also preparing for reality: Profits can't go up like this fast forever. Next year's earnings growth is expected to decelerate to around 10%, according to FactSet.
Against this backdrop, investors are no longer willing to pay ridiculous prices for stocks. The S&P 500 is now trading at about 16.4 times projected earnings. That's higher than the five-year average, but well below the euphoric valuation level of 18.5 hit in January.
So does all of this mean that Wall Street is pricing in the beginning of the end of the good times? Or is this bull market just catching its breath before resuming its run? Stay tuned.
2. May jobs report: Investors will keep a close eye on wages when the Labor Department reveals the May jobs numbers on Friday.
Last month, wages ticked up 4 cents, 2.6% higher than a year earlier. Wages aren't the only things going up - prices have been rising, as well, setting the stage for inflation growth. Higher inflation could trigger faster, steeper rate hikes, which would be bad news for Wall Street.
Investors could respond quickly to wage growth. Earlier this year, when the government reported that wages grew at the fastest pace in eight years in January, markets swung wildly. Wage growth has slowed since then, and inflation fears have calmed.
Wall Street will also be checking to see if economic fundamentals remain strong. In April, the unemployment rate dropped below 4% for the first time since 2000. The economy has added jobs every month for seven and a half years, the longest streak on record.
3. Facebook faces shareholders: The social media platform is scheduled to hold its 2018 stockholder meeting on Thursday.
The company could face tough questions from investors, especially after CEO Mark Zuckerberg's shsaky performance before European lawmakers. On Tuesday, members of the European Parliament grilled Zuckerberg about the company's handling of fake news, extremist content and whether it should be considered a monopoly. They were not satisfied with his answers, and experts think the EU and Facebook will continue to tussle in coming weeks.
The meeting came two months after news broke that Cambridge Analytica, a data firm connected to President Donald Trump's campaign, had access to information of up to 87 million Facebook users without their knowledge. Zuckerberg testified before Congress about a month ago. Investors were heartened by that performance: Shares went up, and Zuckerberg made $3 billion while he sat for questions.
4. Starbucks' big day: On Tuesday afternoon, Starbucks will close around 8,000 of its company-owned locations for racial bias training. About 175,000 employees will participate.
The company announced the plan soon after two black men were arrested in a Philadelphia Starbucks while waiting for a friend. The incident sparked outcry and prompted an apology from CEO Kevin Johnson, who promised to make sure that nothing like that ever happens again.
The training is one step in that effort. A new policy that allows Starbucks customers to spend time in stores and use the bathroom without making a purchase is another. And there are more to come, including additional trainings.
Starbucks has won praise for responding so swiftly and forcefully to the arrest. The coffee chain will share the materials used in the training, and more information, next week.
5. Fate of the Volcker Rule: On Wednesday, the Federal Reserve will meet to discuss possible changes to the Volcker Rule, a controversial part of the post-crisis Wall Street reform.
The rule prevents banks like Goldman Sachs or JPMorgan from making risky wagers with their own money, and also from owning big stakes in hedge funds or private-equity firms. Wall Street has been complaining about the rule for years. Now, the Fed may make some changes that could please big banks.
6. Coming this week:
Monday -- US markets closed for Memorial Day
Tuesday - Consumer Confidence Index for May
Wednesday - Amazon, Exxon Mobil, Twitter, Walmart annual shareholder meetings; Fed discusses Volcker Rule
Thursday - Facebook annual shareholder meeting
Friday - May jobs report
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