Earnings season is looming, and it’s not looking good.
About 77% of the companies issuing preannouncements say their profits will be worse than Wall Street expects.
That’s the second-highest level of pessimism on record since FactSet started keeping track of preannouncements in 2006.
Two tariff-sensitive sectors, tech and health care, are seeing the most negativity. But analysts expect earnings for the S&P 500 Index as a whole to drop 2.6% from where they were a year ago.
Peak Velocity Trader Editor Michael Carr calls it “earnings-geddon.”
He says companies that miss Wall Street’s expectations “should see their stocks fall 5% or more.” That means index investors are going to have a terrible time.
But it’s actually the perfect season for stock pickers like us…
In today’s Market Insights, Michael and Insider Profit Trader Editor Brian Christopher explain what you need to do next to come out ahead.
They also discuss:
- Tariffs are eating away at manufacturers’ profits. Many companies risk hurting sales by passing on the cost of tariffs to customers via higher prices. Quote: “More and more, we’re going to see companies pass it on because they have no choice.”
- Despite widespread pessimism, the S&P 500 is hitting new record highs. Michael says low bond yields are forcing investors into the stock market. Quote: It’s “the TINA market. TINA means There Is No Alternative.”
- Federal Reserve Chairman Jerome Powell spoke to Congress this week. Afterward, investors shifted their predictions for future rate cuts. Quote: “He said: ‘The economy is in danger. It is so bad, I’m going to cut interest rates.’ And stocks went up.”
What topics would you like to see our experts discuss in future Market Insights? Let us know by emailing us at SovereignInvestor@banyanhill.com.
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Regards,
Jay Goldberg
Assistant Managing Editor, Banyan Hill Publishing