While reporting season will set the scene for the year ahead, investors can expect a subdued local economy and share market in 2017, while the international backdrop will be more positive. As always, reporting season will turn on how companies perform against expectations. Outside the mining sector, the market in aggregate is at risk of disappointing. Corporate earnings are unlikely to be as strong as expected, particularly among the domestic cyclicals that face an increasingly weak underlying domestic economy. There will be exceptions such as housing-related retailers and mining service companies. Overall however, companies are likely to remain cautious in respect of their outlooks, which may well disappoint investors who have bid up cyclical and ‘value’ stocks.