Home goods retailer Linens 'n Things has filed for Chapter 11 bankruptcy protection and plans to close 120 underperforming stores, the company said on Friday.

NEW YORK (Reuters) - Home goods retailer Linens 'n Things has filed for Chapter 11 bankruptcy protection and plans to close 120 underperforming stores, the company said on Friday.

The stock market has reacted well to the recent stream of glum earnings. But this week, Wall Street faces an even bigger flood of first-quarter results.

U.S. home goods retailer Bed Bath & Beyond posted quarterly net profit  on Wednesday that fell 16 percent and gave a first-quarter earnings outlook well below Wall Street expectations, as the nationwide housing slump weighed on sales.

Earnings season kicked off Monday, and investors are bracing for some fairly ugly results, especially in the beaten-down financial sector.

As investors come to terms with the fact that the U.S. economy is either in or heading toward a recession, Wall Street is bracing for earnings season, which kicks off Monday with Alcoa.

Stocks closed lower Friday after a profit warning from J.C. Penney, which renewed fears about slower consumer spending. Financials and techs caved in after earlier attempts to rally.

Stocks advanced Friday, boosted by benign inflation data and an upgrade on Lehman Brothers.

Stocks rose at the opening bell as the market weighed benign inflation data with a weak outlook from J.C. Penney.

Home goods retailer Williams-Sonoma reported a decline in its holiday same-store sales Tuesday and gave a weak outlook for the current quarter and upcoming fiscal year, sending its shares down 11 percent in morning trade.

U.S. home goods retailer Bed Bath & Beyond posted a lower quarterly profit and warned that its fourth-quarter results would be lower than expected, sending its shares down almost 10 percent.