Wall Street gears up for busy earnings week
Amazon, Microsoft and Exxon set to report
NEW YORK — Forget about French elections or the flagging Trump trade.
Corporate America is set to unleash its biggest profit-reporting fest in at least a decade next week, with more than 190 members of the S&P 500 index delivering quarterly score cards, according to S&P Dow Jones Indices data.
The lineup accounts for around 40 percent of the benchmark index’s value, or more than $7.7 trillion, and includes big names like Google’s parent Alphabet, Amazon.com, Microsoft and Exxon Mobil.
The onslaught could keep stock investors’ focus largely on earnings next week even as the world’s attention is likely to be drawn elsewhere.
Many strategists have attributed the 10 percent rally in the S&P 500 since Donald Trump’s victory over Hillary Clinton in the Nov. 8 presidential election to optimism Trump would boost the domestic economy through tax cuts and an infrastructure spending binge.
Upbeat earnings from Morgan Stanley and other banks so far this reporting period cushioned geopolitical worries, helping push the S&P 500 up 0.9 percent this week, its best such performance in two months.
Shares of smaller companies did even better, with S&P’s benchmark indexes for small and mid-cap stocks notching their best weeks of 2017, with gains of between two percent and thee percent.
Expectations for the quarter’s profit growth have risen as well, and the first three months of the year now appear set to mark the strongest quarterly earnings growth in more than five years. In the past week alone, expected S&P 500 first-quarter earnings per share growth rose to 11.2 percent from 10.4 percent, a more than 7 percent jump, according to Thomson Reuters data.
Just 76 companies reported this week compared with 134 in the comparable week a year ago. Next week’s rush will represent a 15 percent increase from the 166 S&P constituents that reported in the comparable week last year.
Thursday will be the busiest day with nearly 70 reports due, including updates after the closing bell from Alphabet, Amazon, Intel Corp, Microsoft and Starbucks Corp.
That could make for a bang in the market on Friday, which is also the final trading day of April, said Howard Silverblatt, senior index analyst at S&P Dow Jones Indices.