By Kate Gibson

The U.S. stock market is likely to begin the new week in a less-than-calm state, with investors veering between hope and despair after a slew of disappointing economic reports and a mixed burst of quarterly earnings reports.

"The market is manic depressive, great one day and terrible the next," said Paul Nolte, managing director at Dearborn Partners.

On Friday, stocks were battered by less-than-expected revenue from Bank of America Corp. (BAC) and General Electric Co. (GE), while a slide in a gauge of consumer confidence fell to an 11-month low.

Friday's sharp slide followed a late-session bounce back the day before as investors cheered the government settling its fraud suit against Goldman Sachs Group Inc. (GS) and BP Plc (BP) halting, at least temporarily, the flow of oil spewing in the Gulf of Mexico.

The flow of companies reporting widens in the days ahead, one of the peak weeks for the second-quarter earnings season, as 12 components of the Dow Jones Industrial Average (DJI) are scheduled to release results along with 122 S&P 500 (SPX) companies.

The calendar is fullest on Tuesday and Wednesday and includes names recently in the news, namely Apple Inc. (AAPL) and Goldman Sachs Group Inc., along with (GS), Harley-Davidson Inc. (HOG), Johnson & Johnson (JNJ), Yahoo Inc. (YHOO) and AT&T Inc. (T).

"The market has reached a point of equilibrium, where there is a tug of war between the soft patch in the economic data stream and better reports out of corporate America," said Art Hogan, chief market strategist at Jefferies & Co.

That soft patch included signs of weakening in both the consumer and manufacturing sectors, two areas that displayed unexpected strength during the winter months, David Wyss, chief economist at Standard & Poor's, noted in a research note on Friday.

"On the positive side, BP fixed the oil leak, Goldman fixed its legal problems with the SEC, and Apple (sort of) fixed the iPhone," wrote Wyss, who added he still believes the recovery will continue, albeit at a reduced pace.

While there were ample reasons for Friday's fall, Nolte said the drop amplified a trend in play for the past six months that has stocks retreating at the end of the week only to rebound the following Monday.

"Nobody wants to hold positions over the weekend, and then on Monday, when the sentiment is, 'okay we survived and didn't collapse, and maybe a merger was announced," the analyst said.

Damage done

All told, the market on Friday tallied its worst session in more than two weeks, turning tail on what the day before was looking like a second week of gains.

As stocks sank 2-year Treasury yields fell to a record low and 10-year Treasury yields remained under 3% for a second day. The Japanese yen climbed to a 2010 high against the dollar and crude-oil futures fell for a third consecutive day.

After halting a seven-session winning stretch the prior day, the Dow Jones Industrial Average (DJI) on Friday lost 261.41 points, or 2.5%, to end at 10,097.90.

After climbing more than 7% from a 10-month low in early July through Thursday, the S&P 500 Index (SPX) on Friday erased its weekly advance, falling 31.61 points, or 2.9%, to 1,064.87, off 1.2% for the week.

The Nasdaq Composite (RIXF) slid 70.03 points, or 3.1%, to 2,179.05, off 0.8% from the prior week's close.

The first day of the week brings results from Halliburton Co. (HAL), Hasbro Inc. (HAS), International Business Machines (IBM), Texas Instruments Inc. (TXN) and Zions Bancorp (ZION).

Xerox Corp. (XRX), United Parcel Service Inc. (UPS) and Union Pacific Corp. (UNP) are among those slated to report results Thursday, while McDonald's Corp. (MCD), Ford Motor Co. (F) and Honeywell International Inc. (HON) are among those listed for Friday.

On Friday, estimated share-weighted earnings for the S&P 500 for the second quarter stood at $185 billion, above the prior's $182.6 billion, according to John Butters at Thomson Reuters.

Of the 48 S&P 500 companies that have already reported, 75% topped analysts' expectations and 13% reported results inline with projections and 13% reported results beneath estimates, Butters found.

A typical quarter, going back through 1994, would have 62% beating estimates, 18% matching and 20% missing, according to Butters.

By the end of July, more than 60% of the companies listed on both indexes will have released results.

Beyond quarterly results, Federal Reserve Chairman Ben Bernanke is expected to stick to a cautiously optimistic tone when he delivers his semi-annual monetary policy to report to Congress on Wednesday.

"The economy is improving but not at a breakneck pace," offered Hogan.

Economic data in the days ahead includes a trio of reports on the housing market and the leading indicators for June.

"The economic data is still just okay, and earnings numbers are not bad," said Nolte.