Coronavirus fears spoiled a solid earnings season and will further dominate markets ahead

"The virus is totally underrated," CNBC's"What I think is a little too premature is they all presume that it is going to be solved within a foreseeable time frame. At what point do we say that many, many companies are going to be hurt by the virus [and] we're paying too much for stocks."Wall Street analysts have been quick to slash their earnings expectations for the next quarter in light of the fast-spreading virus.

Companies themselves are also lowering guidance for earnings growth in the near future. There have been more U.S. companies issuing below-consensus guidance for the next quarter than those with upbeat forecasts, marking the weakest ratio in a February since 2014, according to Savita Subramanian, head of U.S. equity and quantitative strategy at Bank of America.

"While guidance is typically weak in the first quarter as corporates set a low bar, it has been more cautious than usual this earnings season, likely due to the coronavirus," Subramanian said in a note. Nearly half of the S&P 500 companies have cited coronavirus during their earnings call this season, according to FactSet. These companies' average revenue exposure to China is 7.2%, compared to 4.8% exposure for the average S&P 500 company.

As of Friday, China's National Health Commission reported more than 75,000 confirmed cases and over 2,000 deaths on the mainland. South Korea has also reported more than 200 cases. Meanwhile,"Lost in those headlines is corporate America's impressive performance this earnings season," John Lynch, LPL Financial's chief investment strategist, said in a note. "Companies have done an admirable job growing profits considering stiff headwinds.

Why on earth stress about the virus, the Fed is closely monitoring it and ready to cut on anything. The scientists and doctors are about done, fed policy will clean this inconvenience up in no time, right?

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