Earnings season heat brings high stakes, high expectations
New York (Reuters) : The U.S. stock market in two years will meet a tough test in the coming weeks as first-quarter earnings pour in, with outlook that tax cuts will help Corporate America show its largest quarterly profit growth in seven years. Any disappointments could further upset the delicate market.
Hopes amid stock investors are consecutively high for corporate earnings season, which kicks off in earnest on Thursday and Friday with info from several bigfinancial institutions including BlackRock and JP Morgan.
Investors have had it on fingers on corporate profits to provide substratum support as the market endured quick swings in recent weeks over concerns about a trade war with China and tougher regulations for high-flying technology companies.
The S&P 500 .SPX has improved some after swooning more than 10 percent in February from its Jan. 26 record high, confirming a market correction for the first time in just over two years. The benchmark index remains more than 7 percent off its all-time peak.
Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana said, “There is an awful lot of pressure for corporate profits in this first quarter and especially the guidance the companies are going to give to really get this market back on its upward track,”
Credit Suisse analysts calculated that more than one third of that growth in the first quarter can be attributed to tax benefits.