Friends We have several important earnings releases coming after the close today and before the opening bell tomorrow, but today’s damage in the stock market (particularly the Dow) came from a few of the Dow components disappointing earnings reports led by “big blue” IBM (13 straight quarters of declining sales will do that). As expected, this earnings season could be somewhat volatile. So far, and it’s still early, we have seen some bottom line beats, but revenues continue to decline, and that is the pressing issue.
As for today, the Dow Jones Industrial Average was down 181 points to close at 17,919. The S&P 500 was down 9 points to finish the day at 2119. Gold was down $9 to trade at $1097 per ounce, while oil was up $.21 to trade at $50.59 per barrel WTI.
As mentioned, revenues so far this quarter are down 4% in companies that have reported. Earnings continue to be ok, given the effects of cost cutting and corporate buybacks (financial engineering), but it will be interesting to see when investors begin to demand revenue growth as part of the equation. By the end of this week, we should have a better idea whether market participants had priced in these lowered earnings expectations.
Have a nice evening everyone.
