Bulls vs Bears – Earnings season has proven to be a series of moving the goal posts. With more than ¾ of the S&P500 having reported by now, 70% have beat EPS forecasts. Great! But hold the phone – the bars have been lowered drastically. Concentration risk in the FANGs persists (see below – Breadth troubling?) but they all reported this week and did quite well, although Amazon’s “reinvestment” being taken poorly today – it’s coming off all-time highs YESTERDAY so lets not fret. And these companies have nearly become as defensive as the traditional consumer staples names. Positive linearity has been a oft-cited phrase; are things stabilizing to getting better? That’s the bar right now. At some point the Street will need to see actual growth but we’re not there yet.
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