S&P’s $8 Trillion Rally Will Be Tested by Tricky Earnings Season

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Bloomberg Notícia

Corporate Earnings,Quarterly Earnings,S&P 500

(Bloomberg) -- Traders are staring down a series of risks after the stock market’s torrid start to the year, from economic fear, to interest rate uncertainty...

-- Traders are staring down a series of risks after the stock market’s torrid start to the year, from economic fear, to interest rate uncertainty, to election angst. But perhaps the most important variable for whether equities can keep rolling returns to the spotlight this week: corporate earnings.The S&P 500 Index has soared roughly 20% in 2024, adding more than $8 trillion to its market capitalization.

Reports from major companies start arriving this week, with results from Delta Air Lines Inc. due Thursday and JPMorgan Chase & Co. and Wells Fargo & Co. scheduled for Friday. Positioning in trend-following systematic funds is now skewed to the downside, and options market positioning shows traders may not be ready to buy any dips. Commodity trading advisers, or CTAs, are expected to sell US stocks even if the market stays flat in the next month, according to data from Goldman Sachs Group Inc. And volatility control funds, which buy stocks when volatility drops, no longer have room to add exposure.

Friday’s jobs report, which showed the unemployment rate unexpectedly declined, quelled some concerns about a soft labor market.

 

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