What happened

Shares of upscale retailer Nordstrom (NYSE:JWN) were sharply higher on Wednesday afternoon, a day ahead of the company's quarterly earnings report, amid a broad-based market rally driven by rising optimism about the post-pandemic economy.

As of 2:45 p.m. EDT, Nordstrom's shares were trading up about 14.9% from Tuesday's closing price.

So what

Nordstrom was one of several brick-and-mortar retailers trading higher on Wednesday amid signs that the White House and Congress may be moving toward agreement on additional measures to bolster the U.S. economy. Stocks in other sectors hit hard by the effects of the coronavirus pandemic -- airlines and travel stocks, for instance -- were also up on Wednesday.

The entrance to a Nordstrom store in New York City.

Expect an update on Nordstrom's efforts to reopen its stores tomorrow. Image source: Nordstrom.

Nordstrom is set to report earnings for the quarter that ended on May 2 after the market closes tomorrow. Wall Street analysts polled by Thomson Reuters expect Nordstrom to post a loss of $0.95 per share on revenue of $2.41 billion. 

Both would be down sharply from a year ago when Nordstrom reported a profit of $0.23 per share on revenue of $3.44 billion. But given that Nordstrom's brick-and-mortar stores in the U.S. and Canada were closed for much of the quarter, steep year-over-year declines on the top and bottom lines are to be expected.  

Now what

Will Nordstrom's earnings please Wall Street? The recent track record of other consumer-discretionary store chains' earnings isn't good. Kohl's (NYSE:KSS) missed Wall Street estimates when it reported earnings last week, as did Urban Outfitters (NASDAQ:URBN).

If there's an upside surprise when Nordstrom reports, I'd expect it to be around the company's online sales. CEO Erik Nordstrom said in April that the company's well-developed online storefronts were doing well under the circumstances and were able to fulfill online orders from its shuttered stores. 

While online sales gains are unlikely to come close to offsetting sales lost while stores were closed, they might come in better than analysts expect. We'll find out tomorrow afternoon.