Earnings season is underway on Wall Street, with companies like JPMorgan and Bank of America posting solid earnings but seeing muted gains. Netflix also reported strong results but saw a 5% drop in shares. Analysts warn of high valuations and investors’ impatience with any missteps.
Analysts projected just under 5% earnings growth for the S&P 500 in Q2, which rose to 5.6% as more companies reported strong results. While 83% of S&P 500 companies beat EPS estimates, the average earnings surprise of 7.9% lags the five-year norm of 9.1%. Investors are showing little patience for any stumbles.
Stocks are trading at record highs after threats of tariffs led to a sell-off, but the White House has softened its stance. This “TACO trade” — belief that Trump often backs down from tariff threats — has fueled market rallies. However, underlying uncertainty persists as investors await more earnings reports on tariff-sensitive industries. 1. The stock market saw a significant drop today, with the Dow Jones Industrial Average falling 500 points. This decline was attributed to concerns over rising inflation and interest rates, leading to a sell-off in tech and growth stocks.
2. The latest unemployment numbers show a decrease in jobless claims, with 290,000 new claims filed last week. This marks a slight improvement from the previous week and indicates a positive trend in the labor market.
3. In international news, tensions continue to rise between Russia and Ukraine, with reports of increased military activity along the border. The United States and European Union have expressed concern over the situation and called for de-escalation.
4. A new study has found that the COVID-19 vaccine is highly effective in preventing severe illness and death from the virus. The study, which analyzed data from over 100,000 cases, showed that vaccinated individuals had a significantly lower risk of hospitalization and mortality.
5. The housing market remains hot, with home prices continuing to rise across the country. The median home price is now $350,000, a 15% increase from last year. Low inventory and high demand are driving up prices, making it a challenging market for buyers.
Read more at Yahoo Finance: Wall Street raises the stakes as stocks hit records