The latest earnings season has shown a mix of good and not-so-good news. Around 25% of big companies in the S&P 500 have shared their results for the last quarter of the year. While some numbers weren’t as great as hoped, about 70% of these companies have made more money per share than expected.
However, this is a bit lower than what we’ve seen before. Big tech companies like Amazon, Apple, and Microsoft haven’t shared their reports yet. When they do, it could change how things look altogether.
Reports from the financial sector have noticed something called “re-risking.” It means clients are moving their money from safer investments to other options, showing they still believe in the stock and bond markets.
This is backed up by strong spending from consumers, like what American Express has seen lately. It suggests that people are still buying things even though prices are going up.
Tech’s Potential Impact
People are eagerly waiting for big tech companies to share their earnings. Many believe that their reports could change how the earnings season turns out.
Looking back at how they’ve done before and what experts are saying now, it seems like these top tech companies could make a big difference in how much money the S&P 500 makes.
This is especially noticeable because other companies in the index might not be doing as well. Relying on big tech for earnings growth shows just how important they are in today’s market. With the economy growing slowly, it’s hard to find other sectors that can make as much money as tech can.
Continued Market Confidence
Even though there have been some letdowns in earnings and predictions for how much money each share makes in the S&P 500 for the whole year have gone down a bit, the market is still doing pretty well.
The S&P 500 has gone up by 2.5% until last week, even though people expect less money to be made per share in 2024. This shows that investors might be thinking about the future more than just what’s happening right now.
They’re probably considering how much money companies can make in the long run and how they can grow. If big tech companies do as well as expected, it could make people even more hopeful about the market, especially because they’re expected to make a lot more money.
