Wall St Week Ahead: Energy price spike adds market risk as earnings arrive

U.S. stock market investors are gauging whether more volatility is ahead because of surging global energy prices, which could drive up inflation, erode profit margins and pressure consumer spending.

Stocks rebounded this week after Monday’s losses left the S&P 500 down 5.2% from its record high hit in September. A truce in the U.S. Congress to avoid a debt default provided some relief, but investors remain worried about inflation, higher U.S. Treasury yields and the Federal Reserve’s plan to unwind its easy money policies.

Energy costs are a major factor for inflation, and will be a key topic as companies report third-quarter results in coming weeks. Oil prices have surged more than 25% since late August, with Brent topping $80 a barrel and hitting three-year highs.