The earnings report season on Wall Street has been marked by solid corporate results, generating positive momentum in the stock market. According to Bloomberg Intelligence data, if the current trend persists, this would be the best response to earnings reports since 2018.
Among the companies that stood out for their earnings is Netflix, whose shares rose nearly 10% after reporting the largest quarterly subscriber increase in its history. Additionally, JPMorgan Chase & Co., Goldman Sachs, and Delta Air Lines saw significant increases in their stock prices due to their strong financial results.
The solid results have been welcomed with relief by U.S. investors, as the S&P 500 had been trading sideways throughout January, with reductions in interest rate cut expectations and fears of a possible global trade war. This change in dynamics on Wall Street highlights the importance of earnings reports for the market.
Analysts have noted that the volatility of the results is higher than usual, which could be an indication of a shift in sentiment among investors. Companies that have exceeded analysts' earnings estimates have experienced strong increases in their stock prices, contributing to market confidence.
Despite uncertainty surrounding inflation, interest rates, and President Donald Trump's policies, strong corporate results have provided some stability to Wall Street. However, already high valuations and reduced expectations of future earnings pose challenges for some companies, especially in the technology sector.
The most active phase of the earnings season on Wall Street is about to begin, with companies representing nearly 40% of the S&P 500 market capitalization scheduled to report results. This stage is expected to reveal significant differences between winners and losers, which could influence the market direction in the coming weeks. Investors are becoming more selective in an increasingly competitive environment, which could translate into wider movements in S&P 500 stocks.
