Over the past month or so, the big conversations in the market have revolved around the Greek debt crisis and Chinese market crash. However, those issues are no longer the spotlight of the finance world. Now, everything seems to be on earnings. The reality is that if earnings are positive, chances are that we will continue to see overwhelmingly bullish activity in the market.
Adversely, if earnings reports are negative, we're likely to start seeing declines. Today, we'll take a look at some of the most influential reports that have been released so far, reports that are coming soon, and what we can expect to see from the market as a result.
Influential Earnings Reports Already Released
We are already a little more than a week into earnings season and I have to admit, things are looking better than I expected. Here are a few influential earnings reports that have been released so far...
- Google – Last week, Google earnings took investors by surprise in a very good way; absolutely blowing away analyst expectations. As a result, Google shares climbed by nearly 16% in the biggest single day gain the company has ever seen. As a matter of fact, gains were so big that they pushed the stock so high that the companies surge had an overwhelmingly positive affect on the NASDAQ as a whole; pushing it to a new record high.
- Intel – Intel also produced a great earnings report. In the second quarter, Intel produced earnings per share of $0.55; $0.05 higher than analysts expected to see. The company's revenue also beat analyst expectations by $180 million!
- Banking Industry Overall – Overall, the banking industry as a whole produced positive earnings results for the second quarter. JPMorgan beat earnings expectations by $0.10, Bank of America was ahead $0.09 per share, and Citigroup generated $0.10 more than expected. All in all, every report we've seen in the banking and finance industry has been overwhelmingly positive.
Influential Earnings Reports To Come
Considering what we've seen so far, things are looking pretty good for a continuation of the bull market. However, for this to happen, earnings reports will have to continue on the positive trend. This week, I'll be paying close attention to the following earnings reports...
- Apple – Apple has an incredible track record when it comes to their ability to produce positive earnings. As a matter of fact, for the past 7 consecutive quarters, Apple has come out ahead of analyst expectations. However, there have been concerns over growing competition in the smartphone space; so this will be an interesting one to watch.
- Microsoft – Microsoft also has an incredibly positive record with regard to earnings. Over the past 7 quarters, the company has produced better than expected earnings per share 5 times. However, analysts at RBC Capital are pointing to a dwindling demand for personal computers as a reason Microsoft may not wow investors this quarter.
What Can We Expect To See?
If you would have asked me this question even two weeks ago, my answer would have been quite a bit different. However, with the overwhelmingly positive reports we saw last week and the solutions being found for major financial issues around the world, I'm starting to believe that we may be continuing the bull market.
While I don't think we're quite out of the woods yet, I do think that things are looking a bit better for the market. With that said, keep an eye on next week's earnings. If they prove to be as positive as what we've seen so far this earnings season, we can expect to see a continuation of the bull run.
What Do You Think?
Where do you think the market is headed and why? Let us know in the comments below!
