Stock market highs are in, unless 3rd-quarter earnings clear this bar, analyst says
It’s all eyes on earnings season, and the results that will begin to pour in heavily this week may determine whether the S&P 500 can press on to further records before year-end, says one closely followed Wall Street veteran.
“The companies of the S&P 500 need to beat by an aggregate 10 percentage points this quarter, or we’ve almost certainly seen the highs on U.S. equity markets for the year,” said Nicholas Colas, co-founder of DataTrek Research, in a Monday note.
It’s been a torrid year for earnings, with first-quarter results topping estimates by 27 percentage points and second-quarter results beating by 17 percentage points, he said. That compares with an average beat of 3 to 4 percentage points seen in a typical quarter, and…