Wednesday, July 22, 2009

Earnings Season So Far

Here is my summary of what has happened in earnings for far:

  • Business is bad and everybody knows it

  • Expectations for earnings were very low

  • Appetite to own stocks was increasing as the rally off the March lows gave people hope again

  • Revenue was weak as expected in the Q, but no weaker than company managements had expected which led to

  • Almost every company beating the bottom line estimates

  • Stocks rallied 10 days in a row

I think that game, or phase of the game is over. As some dude on CNBC just mentioned, people are beginning to realize that expectations were low and so consequently the metal bar of what is better than expected is moving up. I still think we get one more sharp pullback before the year end rally so it just might start now. The futures are looking weak this morning. Or not. You know.

Wells Fargo and Morgan Stanley report today. The large financials continue to be the most controversial stories. Cn we rally without them, how bad is commercial real estate etc.?


I need to get out of here (my house). The kids had a sleepover last and there are way too many of them here right now. At least I survived last night.

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