Inventories fell sharply last week as Dow Jones Industrial Average (^ DJI 1.47%) and the S&P500 (^GSPC 2.39%) lose 2%. The decline set new lows in 2022 for the indices, which are now down 11% and 16% to date, respectively.

Investors will receive key updates on the pace of consumer spending over the coming week, with earnings reports on the way from walmart (WMT 0.39%) and Home deposit (HD 2.19%). Palo Alto Networks (PANW 2.61%) is another stock to watch over the next few trading days.

Let’s take a closer look at these upcoming reports.

Walmart customer traffic

Investors warmed to Walmart shares during the latest market crash, but that change will be tested when the retail giant releases its fiscal first quarter results on Tuesday morning. Investors have some big questions ahead of this announcement.

The first is whether Walmart is still seeing strong trends in consumer spending, even as economic growth slows. Same-store sales rose 6% in the main US market last quarter, and most investors expect only a modest deceleration this time around. Look at customer traffic, which grew 3% last quarter, as a key measure of underlying sales strength.

The other key concern is whether Walmart still manages to use its scale to offer lower prices and a fuller selection of merchandise. These assets have helped the chain gain market share through early 2022, and shareholders should see positive returns if the retailer can continue to capitalize on this competitive advantage.

Home Depot customer traffic

Home Depot experienced epic growth during the early stages of the pandemic. But investors fear the good times are about to end for the home improvement retailer. Concerns abound ahead of Tuesday’s earnings announcement, including a potential slowdown in residential spending due to rising interest rates. Inflation could also put pressure on customer spending, especially compared to a year ago when federal stimulus measures revived the economy.

Today, most investors following the stock are bracing for Home Depot to see a drop in sales, with revenue hitting $36 billion from $37.5 billion a year ago.

CEO Craig Menear and his team will likely discuss prospects for modest growth in 2022 after the company added $40 billion to its revenue base in the previous two years.

In February, executives had predicted roughly flat profitability and “mildly positive” same-store sales, but that forecast could drop this week to reflect slowing sales in the home improvement market.

The outlook for Palo Alto

Look for volatility in Palo Alto Networks shares around Thursday’s earnings release. Shares of the cybersecurity specialist have swung wildly so far in 2022 as investors debate its long-term growth prospects. Demand for his services has surged as commerce has moved online in recent years. But Palo Alto could see a downturn ahead. And the stock looked expensive, given its relatively low earnings.

The company could easily earn that lofty valuation if it continues to grow its customer base and service portfolio. Look for success here to appear in Palo Alto’s sales metric and average contract renewal size. Convincing existing customers to sign up for more offers, as well as adding new customers, is the company’s surest path to accelerating profit growth.