Trailing 12-month earnings per share for the S&P 500 (SPY) have been rising sharply over the last several months. Since the low of $48.23 on Dec. 31, 2009, earnings are up 66% to $79.95 currently, and are expected to rise above $85 in the next 12 months. The highest recorded earnings for the S&P were hit on Oct. 9, 2007 at $89.96, and with Deutsche Bank forecasting a top down figure of $96 in 2011, that number may well be eclipsed.
Below we highlight reported earnings for the S&P 500 index versus the index price as well as significant highs and lows. It is interesting to note that earnings seem to play an irregularly significant role in the rise and fall of stock prices. In 2007 the market and earnings peaked hand in hand, although in 2009 stock prices bottomed nearly nine months prior to earnings. Likewise in 2000, the market peaked well in advance of the earnings peak, although earnings started to gain prior to stock prices.
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