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The Reformed Broker

Second quarter predictions continue to decrease as stocks fall

As stocks continue their decline, market analysts have revised Q2 estimates slowly but steadily downward for almost the entire spectrum of S&P sectors all spring and summer long. Not a lot of good news here, not that the Reformed Broker is surprised.

By Guest blogger / July 12, 2012

In this June 2012, file photo Specialists Frank Masello, left, and John T. O'Hara work on the trading floor of the New York Stock Exchange in New York shortly before the closing bell. All indications so far point to a slow summer as second quarter predictions continue to be adjusted downward.

David Karp/AP


We've seen Q2 estimates slowly taken down for almost the entire spectrum of S&P sectors all spring and summer long.  Steven Russolillo at MarketBeat tells us what we can expect:

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Joshua has been managing money for high net worth clients, charitable foundations, corporations and retirement plans for more than a decade.

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Analysts currently expect second-quarter earnings growth for S&P 500 companies to come in a negative 2.1% rate, according to S&P Capital IQ. That would mark the worst growth rate since the second quarter of 2009.

Specifically, only three sectors — industrials, tech and consumer staples — are expected to see earnings expand, while the rest are expected to register slower growth.

Materials and energy lead the laggards, as both sectors are forecasted to report earnings growth slowed by 12% and 11%, respectively. The expected slowdown in the materials sector — specifically in the manufacturing and aluminum industries — comes after manufacturer Cummins and aluminum producer Alcoa reported disappointing quarterly results earlier this week.

I'm doing very little little trading here, content to watch over a dividend-focused, large value-oriented portfolio as we head into what looks to be an earnings season not to remember.

What else is going on?  Everything good otherwise?

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