Markets know the game: Reducing investors’ EPS expectations so firms can beat them

“Analysts have been revising downward their earnings estimates for weeks, so the standard has been set very low. If companies are not able to beat them markets would be very disappointed, accustomed as they are to “this game” in which analysts first reduce expectations so that, subsequently, the majority of companies can exceed them,” Link Securities’ J.J. Fdez- Figares commented on Monday.

Therefore, and starting this week, business results and what managers say will be of special relevance for US equities and, consequently, the rest of Western stock markets.

It remains to be seen if the dollar’s strength and the weakness of the economic environment can dent US listed companies’ numbers.

 

 

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