Wall St Week Ahead: Rally's fate turns on bank results

By Ellis Mnyandu

NEW YORK (Reuters) - If Wells Fargo's strong first-quarter preliminary performance is any sign, stocks could rally further this week on any reassuring news when three other big banks post quarterly results.

The earnings season starts in earnest, with banks Goldman Sachs, JPMorgan and Citigroup set to report their latest scorecards. Both JPMorgan and Citigroup are Dow components.

General Electric, another Dow component, will report earnings on Friday. GE, whose businesses range from broadcasting to making jet engines, is closely watched because its results and outlook may shed light on the broader economy's health.

Hopes that the economic slump may be abating and some stability may be returning in the banking sector have helped underpin a month-long recovery in stocks from 12-year closing lows hit in early March.

"The market is looking like it wants to continue the rally," said Andre Weisbrod, president and chief executive officer of STAAR Financial Advisors Inc in Pittsburg, Pennsylvania.

"But again, so much of this depends on the news of the day. It looks like we're going to see the banks showing some improved cash flows, and that's certainly better than the opposite situation."

The benchmark Standard & Poor's 500 Index scored its fifth straight weekly gain at Thursday's close, when trading ended for the short holiday week. On Thursday alone, both the S&P and the Nasdaq jumped almost 4 percent, while the Dow industrials climbed 3 percent.

The latest rally was triggered by Wells Fargo, the fourth-largest U.S. bank, which surprised Wall Street by saying it expected to post a record $3 billion profit for the January through March quarter. Wells Fargo will report earnings on April 22.