Market Outlook: Investors Bracing for More Than One Big Storm

Markets will navigate another big wave of third-quarter earnings in the week ahead, plus some major economic reports—and, most importantly, the October jobs report.

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But nature may also play a role, with a late season hurricane threatening the East Coast along the Washington-New York corridor.

It's too early to say what type of damage the storm could bring, but it could temporarily drive up gasoline prices.

The five remaining East Coast refineries are in the Philadelphia metro area, New Jersey and Delaware. They are capable of producing about 1.2 million barrels a day, or about 8 percent of U.S. refining capacity.

Earnings reports include energy companies such as oil majors Exxon Mobil, Royal Dutch Shell and Chevron. The energy industry was expected to be among the weakest this quarter. There are also reports from Ford, GM, Mastercard, Visa and AIG.

As of Friday, more than half the S&P 500 companies had reported, and earnings are estimated to be down 1.2 percent for the quarter, the first negative quarter in three years, according to Thomson Reuters.

An unusually high 63 percent of those companies have missed their revenue forecasts, and many have made negative comments about the current quarter. However, there were also bottom line beats by 63 percent, as companies continued to manage costs against softer revenue growth.

(Read More: Earnings Look Better So Far, but Market May Not Care)

Stocks have had some rocky sessions in the past week, with the major averages all lower. The Dow tumbled 1.77 percent for the week, while the S&P 500 dropped 1.48 percent.

"I think the market here is going to be just churning," said Leo Grohowski, CIO at BNY Mellon Wealth Management. "It's going to be driven more by earnings news than election polls for the next couple of weeks. I think post-election, I wouldn't be surprised to see a post-election bounce simply because it removes one element of uncertainty. But no matter who wins, we're not off to the races because there's still a lot of wood to chop on the 'fiscal cliff.'"

(Read More: Forget Fiscal Cliff, Brace for 'Fiscal Waterslide')

Daniel Greenhaus, global market strategist at BTIG, said he expects the market to "chop around" until the outcome of the Nov. 6 election is clear.

"Earnings have been mixed. on the one hand earnings per share figures are coming in better than expected," Greenhaus said. "On the other hand, revenues and guidance have been pretty bad, and the companies that have provided guidance have been less than enthusiastic about the outlook."

He said uncertainty about the election, the "fiscal cliff" and negative earnings news has been hitting the market. There is also an element of concern that if GOP challenger Mitt Romney wins, he might change the complexion of the now dovish Fed.

Romney is Wall Street's preferred candidate but he is viewed as unlikely to retain Fed Chairman Ben Bernanke when his term expires in early 2014, and some traders are betting that change would result in a more hawkish Fed.

(Read More: Goldman Says Romney Win Would Be Better for Avoiding 'Fiscal Cliff')

Corporate America is clearly concerned about what happens when Congress addresses the so-called "fiscal cliff," or the dual expiration of Bush-era tax cuts and the onset of automatic spending cuts Jan. 1.

That fear is believed to be holding back corporate spending, and it showed up as softer business investment in Friday's report of third quarter GDP, even as the consumer stepped up spending.

Economists say that trend could slow down growth in the fourth quarter and into next year, particularly if the "fiscal cliff" is not resolved. Third quarter GDP was a surprisingly better 2 percent and was lifted by government spending.

Barclays chief U.S. economist Dean Maki said uncertainty can slow business activity but it does not necessarily lead to layoffs.

"You do see an effect where businesses will slow their spending down when uncertainty rises. Usually, you need a real shock for business to lay off hundreds of employees," he said.

Maki said the best scenario would be a "grand bargain," where Congress agrees to new tax policy and fiscal policy. "If we don't get that and we just push everything off for a year, that pushes uncertainty forward. It doesn't resolve it," he said. That would continue to weigh on GDP in 2013.

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Maki said he expects to see 125,000 non farm payrolls were added in October, up slightly from the 114,000 added in September. The September jobs report also included a surprise dip in the unemployment rate to 7.8 percent.

The employment report is released Friday morning. Other key data this week includes ADP private sector payroll data, ISM manufacturing and October auto sales, all out on Thursday.

What to Watch Next Week:

Monday

Earnings: CNA Financial, Burger King, Lowes, PG&E, Anadarko, Arch Coal, Leggett and Platt, PMC-Sierra, Weingarten Realty, Owens and Minor

8:30 am: Personal income

10:30 am: Dallas Fed survey

2:00 pm: Fed senior loan officer survey