Market Edges Higher as Earnings Season Kicks Off Strong
NEW YORK – Major U.S. stock indices saw mixed performance to close the week, with the S&P 500 and Nasdaq posting gains while the Dow Jones Industrial Average finished slightly lower. The positive sentiment is largely attributed to a robust start to the second-quarter earnings season, where a important majority of reporting S&P 500 companies have surpassed analyst expectations.
Of the 59 S&P 500 companies that have released their earnings so far,over 86% have exceeded forecasts,according to data from FactSet. This strong performance sets a positive tone for the upcoming week, with investors keenly awaiting results from tech giants Alphabet and Tesla. As the first of the “Magnificent Seven” companies to report, their performance is expected to significantly influence the market’s trajectory.
Analysts anticipate that these megacap companies will be key drivers of overall earnings growth for the second quarter. FactSet’s John Butters projects that the Magnificent Seven will collectively achieve 14% earnings growth, a stark contrast to the 3.4% growth expected from the remaining 493 S&P 500 companies.
Mark Malek, chief investment officer at Siebert Financial, highlighted the current market environment, noting that the S&P 500 is trading at an all-time high at the commencement of earnings season.He emphasized the importance of a successful earnings season, stating, “If we can get through this earnings season with not too many major failures, I think that is realy, really important at this point, if we want to continue this upward momentum that we have in the market.”
Looking ahead, the economic calendar includes the release of the June reading for leading indicators on Monday at 10 a.m.ET. These indicators are considered predictive metrics for the broader market and economy.
On Monday, investors will also be closely watching earnings reports from companies such as Verizon Communications and Domino’s Pizza.