Not very… and we will leave the calculation for the entire stock market to the stock analysts.
Here’s why:
Just glancing over WalMart’s latest earnings release from the week, we see two one-off macro factors that helped WalMart’s earnings in Q1, and most likely the same for other companies:
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Foreign exchange rate effect
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The tax cut
Note that almost 40 percent of WalMart’s y/y revenue growth in Q1 was due to the exchange effect…
And over 1300 bps of tax cut relief.
That is one-offs.
Though the dollar was weaker in Q1, it has rebounded sharply in Q2.
Thus a deleterious exchange rate effect is coming to Q2 earnings.
Not to mention higher gas prices and interest rates, which will negatively impact the non-energy and non – financial sectors.
via RSS https://ift.tt/2s2zr1i Tyler Durden