As we move past Election Day, financial markets should be able to refocus on what truly matters: company fundamentals. This should serve as a catalyst to push equity prices higher with earnings finally back on the rise. It has been a tough period for earnings because of the strength in the US Dollar and extreme volatility in crude oil prices. This trend appears to have finally stabilized. The energy sector is expected to post a flat quarter after posting huge losses for the previous four quarters.
With over 84% of S&P 500 constituents having reported, the third quarter earnings are estimated at $25.91 or 12% growth year over year. This would be the first time earnings came in above $25 since the 3rd quarter of 2014.