Earnings 'Trump' Trump

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Since 1999, earnings for S&P 500 companies have grown  more than 200% while the price level is now only 60% higher.

Earnings season is 80% complete and in usual fashion, earnings have taken the focus off of geopolitical risks and put it back where it belongs – on the fundamentals. After a commodities bust and earnings recession in 2015/2016 corporate earnings are back on track. Q4 earnings growth was 5% and Q1 is shaping up to be about 13% growth over last year’s Q1. Accelerating earnings growth is the result of broadening manufacturing conditions global wide and consumers happily doing their share of spending, secure and confident in the strength of the housing and employment markets. President Trump’s pro-growth policies have yet to materialize, let alone filter down to corporate profits. So for now give credit where credit is due – the fundamental earnings. Please watch earnings and the S&P500 price on page 6 of the Global Perspectives™ book.

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