In a research note out by the pencil pushers at Morgan Stanley, they cite potential upside in Q3 earnings.
Could Q3 earnings results be a positive driver for the US equity market? The S&P 500 was down 7% last quarter, the worst fall in any quarter since Q3 2011. Q3 2015 earnings expectations have once again been lowered to the point where we would be quite surprised to not ultimately see aggregate earnings upside for the 27th consecutive quarter. With this decline in estimates, we expect reported results to show modest upside. The sample size is small, but earnings for the group of companies reporting as of October 5 generally have been above estimates. The market is following the typical pattern of rewarding companies that beat consensus revenue and earnings while harshly punishing revenue and earnings misses.
Essentially, they believe expectations have been reduced, alongside the prices of equities, to a point where possible reward outweighs risk.
Trading accordingly.
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Morgan Stanley is almost as gay as this new layout
this coming from the Trashman.
Fucking BANNED
Classic Fly!
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