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Get out of the way of that freight train! It's the Dow Express, and the conductor with his head cheerfully peering out the window is Warren Buffett, since he wants to own railroads these days. The Dow busted through record territory last week, but wait, what is all the hoopla about? We can only point to earnings, and there were some positive things to read from the week's reports. Still, let's face it, earnings growth on the whole is going to stink this quarter, relatively speaking. So why is the Dow flying high... well, the Dow is composed of large multinationals that are doing an awful lot of exporting these days, and despite a slumping domestic economy, they're doing alright overseas.

Caterpillar (NYSE:CAT), a Dow component, gapped open higher on Friday and ended the day 4.7% above Thursday's close. The heavy equipment maker posted earnings before gain on security sale that was above expectations, though the company still showed a decline versus the prior year period. Still, anticipated U.S. softness was nearly completely offset by growth overseas. CAT went even a step further and raised its guidance for the year. About a week ago, the International Monetary Fund confirmed that global resiliency would be reinforced by international strength, even despite slowing U.S. growth.

Honeywell International (NYSE:HON), another Dow component, also gapped higher on Friday and closed up 4.8%. Honeywell reported revenue growth of 11%, while exceeding both sales and earnings expectations. HON also raised guidance for 2007. While much of HON's performance can be attributed to the current and future demands of the U.S. military, the company's CEO attributed solid airline industry demand for HON's products to the healthy global economy.

Multinationals are certainly benefiting from the weakening dollar, as their offerings become more price competitive overseas as a result. Wall Street Greek has favored large caps along with every other Tom, Dick and Harry since last year, but nobody has really told you why and which ones. We have painted the picture for you here, other than the attractive valuation and "it's about time" argument, it is the large multinational corporations that are benefiting most from a cheaper dollar.

Now let's look at the week ahead...

Caterpillar (CAT) will follow up its good news from last week with an analysts' day on Monday. The start to the week looks otherwise quiet, depending on international activity or surprises of course. Look for earnings reports from Amgen (NASDAQ:AMGN), Texas Instruments (NASDAQ:TXN) and Kimberly-Clark (NYSE:KMB) to get us warmed up.

The week of reckoning officially begins on Tuesday. All of last week's gains will be asked to show the ID's that got them through the door, and all those player haters that snuck in behind CAT, HON, Schlumberger (NYSE:SLB) and Google (NASDAQ:GOOG) could be asked to leave the party. The week of reckoning has three key components: housing, consumer confidence and the kingpin, the first reading of Q1 GDP.

April consumer confidence will be reported at 10:00 a.m., and despite recently strong retail sales, higher gasoline prices and a deteriorated housing sector should be expected to drive confidence down, in our view. Bloomberg shows a consensus expectation for a decrease in April confidence to 105 from 107.2 in March. Also at 10:00, March existing home sales are widely expected to have declined to 6.4 million, from 6.69 million in February. And the rug of comfort underneath the dwindling number of housing bulls still left, is pulled away...

Whenever Alan Greenspan has a microphone and an audience of reporters, you should know about it. Alan has been invited to give the keynote at the "Boomertirement" industry extravaganza in New York Tuesday. Internationally at our back door, the Bank of Canada will provide its decision on interest rates.

Earnings reports are scheduled for AT&T, Inc. (NYSE:T), Du Pont (NYSE:DD), Occidental Petroleum (NYSE:OXY), Lockheed Martin (NYSE:LMT), Burlington Northern Santa Fe (BNI), Northrop Gruman (NYSE:NOC), Amazon.com (NASDAQ:AMZN) and others.

Last week's gains face another challenge from an important precursor to GDP, the 8:30 report of March durable goods on Wednesday. The consensus view compiled by Bloomberg shows expectations for an improvement of 2.5% growth in March, from 1.7% in February. March new home sales are also seen rising, to 890,000 from 848,000 in February. Relative to home sales and in light of the subprime mess, the Mortgage Bankers Association is scheduled to hold a national policy conference on Wednesday. Clearly some noteworthy news could result.

Internationally, markets in Australia and New Zealand will be closed on Wednesday. Vladimir Putin will give his annual address to the Federation Council. It's possible that he could announce plans for the election of his successor. Last week, there was some speculation that Putin might limit the candidates to individuals he hand selects.

Wednesday's earnings reports include Conoco Phillips (NYSE:COP), SEI Investments (NASDAQ:SEIC), Genzyme (GENZ), PepsiCo Inc. (NYSE:PEP), Apple Inc. (NASDAQ:AAPL), Boeing (NYSE:BA), Qualcomm (NASDAQ:QCOM), Wellpoint (NYSE:WLP), Exelon (NYSE:EXC), United Parcels Services (NYSE:UPS), Anheuser-Busch (NYSE:BUD), Corning (NYSE:GLW), Colgate-Palmolive (NYSE:CL) and General Dynamics (NYSE:GD).

On Thursday, weekly initial jobless claims are seen measuring 329,000 for the week ended April 21. Fed Governor Mishkin, and Presidents Fisher and Yellen are all scheduled to speak on Thursday. Reporting earnings, look for reports from ExxonMobil (NYSE:XOM), Countrywide Financial (CFC), Fortune Brands (FO), Microsoft (NASDAQ:MSFT), 3M Company (NYSE:MMM), Comcast (NASDAQ:CMCSA), Bristol-Myers Squibb (NYSE:BMY), Dow Chemical (NYSE:DOW), Valero Energy (NYSE:VLO), Travelers (NYSE:TRV), Franklin Resources (NYSE:BEN), Halliburton (NYSE:HAL), Hartford Financial (NYSE:HIG), Cardinal Health (NYSE:CAH), Southern Co. (NYSE:SO) and many others.

Drum roll please.... At 8:00 Friday morning, the Advance GDP report is likely to impact the market one way or another. Remember, last quarter the initial reading of 3.5% was revised much lower by final reporting, to 2.5%. This time around, economists are looking for growth of 1.8%, according to Bloomberg. Both the growth information and inflation data will be closely reviewed by the market, and we think a reading above or below the consensus GDP view will be received negatively. We anticipate the market will view strong growth as conducive to a Fed rate hike for the purpose of containing inflation, and a poor measure as a red flag for stagflation. But that's not all... The employment cost index is expected to show a rise of 1%, and the market will be closely attuned for signs of labor wage pressure on inflation. At 10:00, the University of Michigan's consumer sentiment reading is expected to match March's 85.3 figure.

Besides this critical domestic data, the Bank of Japan is due to decide on interest rates. The BOJ is expected to keep rates steady though. Reporting earnings, look for Baidu (NASDAQ:BIDU), Burger King (BKC), Cameco (NYSE:CCJ), Waste Management (WMI), Chevron (NYSE:CVX) and others. Man that's a busy day, with so many factors in play, and I certainly won't attempt to make odds on it. I think a bet on volatility is a safe one for Friday though.

Source: The Week Ahead: The Dow Express Rolls On