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Last week, we looked at how S&P500 companies were doing earnings wise via Birinyi Associates. The numbers were a touch soft (see Earnings Season Getting Underway).

This week teaches us a lesson in the dangers of extrapolation: With 34% of S&P 500 companies reporting, the earnings picture looks much better (versus last week's charts of 11%).

The beats and misses are much more in line with the recent SPX earnings history, which has been the bulwark of the Bull's case.


spx graph


Charts courtesy of Birinyi Associates

Mike Thomson of Thompson Financial has been the prime proponent of "It's all about earnings;" He has been clearly right so far.

The one dark cloud has been guidance: It's a bit softer than it has been recently:

spx_guidance

Charts courtesy of Birinyi Associates

This may change further as reports come in; however, 34% is a much more significant sample than 11%, and strongly implies earnings will be consistent with previous quarters.

Source: Earnings Looking Better