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Earnings season is underway this week (July 10–14) and may be another good

one, with double-digit S&P 500 Index earnings growth possible. But getting to

double digits will be tougher than it was in the first quarter when S&P 500 earnings

increased more than 15% year over year.

First quarter earnings season will be a tough act to follow as the year-over-year

comparison gets more challenging. The first quarter of 2016 was the trough of the

earnings recession, so the first quarter of 2017 had the easiest annual comparison.

Growth improved (fell less) in the second quarter of 2016 as corporate America

began to emerge from the earnings recession, lifting the base for comparison for

the just-completed second quarter. This trend will continue over the rest of 2017

given the earnings growth acceleration achieved during the third and fourth quarters

of 2016 [Figure 1].


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