What will matter more to investors: the government shutdown or earnings?
We’re a week into earnings season. And, we’re a week into the federal government shutdown.
Some big names are reporting this week, including former Dow-component Alcoa, Yum! Brands, JP Morgan Chase, and Wells Fargo. According to Thomson Reuters, the average growth rate for companies in the S&P 500 index this quarter versus last year is expected to be 4.5%. On the top line, average revenues are expected to be 3.0% higher than last year.
But even if the average earnings for companies in the S&P 500 come in as expected, this isn’t an average time for the markets. The federal government has been shut down since October 1 and 800,000 of its workers have been furloughed.
Since the start of the federal government shutdown, the benchmark S&P 500 Index just about flat. It’s slightly better for the small-cap Russell 2000 index, which is up by less than half a percent. TheRead More »from Will earnings tank stocks?