For first time in a decade, U.S. companies could report lower profits on higher revenue

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Wall Street is bracing for large U.S. companies to report a decline in quarterly...

NEW YORK - Wall Street is bracing for large U.S. companies to report a decline in quarterly profits even after raking in higher revenues, something that has not happened in more than a decade.

“Companies are experiencing rising input costs as well as increases in labor costs from modestly rising wages,” said Kristina Hooper, chief global market strategist at Invesco in New York. Stocks have bounced back from a late-2018 selloff on optimism that the United State could seal a trade deal with China and expectations the Federal Reserve would not raise interest rates again any time soon.

Projected sales growth through the rest of the year may also help investors look through any first-quarter margin dips. Warning signs are coming from technology companies, with semiconductors, which have a large revenue exposure to China, seen among the most sensitive to the trade conflict.

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