Expect Q2 Earnings to be Horrible: What That Means for the Stock Market?
The U.S economy was in a great spot prior to 2020, then Covid-19 quickly disrupted its course. The virus created new operational challenges for many companies, ultimately hindering a large percentage of the economy. As many companies either closed or operated at a limited capacity, it is easy to understand why their earnings would deteriorate. So let’s discuss first quarter earnings, what analysts are anticipating moving forward, and how earnings affect the stock market. 1 st Quarter Earnings For Q1 2020, the earnings decline for the S&P 500 was -13.6%. This was a fairly large decline when compared to the -0.40% reading in Q1 2019. Earnings estimates for Q2 are going to be horrible, showing an even steeper decline. 2 nd Quarter Earnings/Moving Forward According to FactSet, “For the second quarter, S&P 500 companies are expected to report a decline in earnings of -43.8% and a decline in revenues of -11.2%. For...