In the US the recent earnings season has been the worst since 2009. If we take financials out the picture, both sales and earnings were weaker; even including the financials 25% growth in earnings per share, earnings for the S&P 500 were up an anaemic 1.27%. Guidance was also poor; 70% of the companies that offered guidance, lowered it.
It may pay to dig down into some of the sectors to find out the reasons for this. The technology sector surprised positively on earnings but it was the smallest earnings beat since 2009 and nearly all the major names missed expectations. These include such luminaries as Apple, Intel, Amazon and Google. There were multiple areas of weakness; the PC market continues to disappear and sales were estimated to be down 8% in Q3 according to Gartner, server sales are down 3% and even the mobile phone market only grew 2.4% globally. The third quarter is the traditional federal “budget flush”; ...
To continue reading this article...
Join Investment Week for free
Signup and gain exclusive members-only insights - all free of charge!
- Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
- Get ahead of regulatory and technological changes affecting fund management
- Important and breaking news stories selected by the editors delivered straight to your inbox each day
- Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
- Be the first to hear about our extensive events schedule and awards programmes
