With just a few days left until the unofficial end of the reporting period, this earnings season is on pace to be one of the better ones of the last several years. The S&P 500 is currently up 4.7% since 10/4 (the Friday before the first of the major banks started to report). If we compare the current period to the prior six-week periods in other earnings seasons that encompassed the first of the major bank reports right up through Walmart’s (WMT) report, the only one with a more positive performance was the 7.6% gain in the Q4 2018 reporting period. Before that, you have to go all the way back to the 6.4% gain during the Q3 2013 period. The market has certainly come a long way from early October when it seemed to be a foregone conclusion that earnings results would be dismal while guidance would be even worse.
If you polled analysts/investors back in late September over which sectors would have the toughest earnings seasons, Financials and Industrials would have topped the list. With earnings season now winding down and these two sectors up roughly 8%, though, the list that these two sectors topped is actually the best performers! Meanwhile, the worst performers have been the high yielding defensive sectors that investors couldn’t get enough of during the summer. Sign up for Bespoke’s “2020” special and get our upcoming Bespoke Report 2020 Market Outlook and Investor Toolkit.