Q1 Complete, What’s Next?

by Matthew Kerkhoff
Financial Sense

With the first quarter of 2016 now in the books, the focus turns to earnings. So far the picture is not looking very pretty.

Earnings for S&P 500 companies are estimated to decline 8.5% (FactSet). If negative earnings growth comes to fruition, it will mark the fourth consecutive quarter of year-over-year earnings declines. The last time that happened was during the financial crisis.

The chart below shows the tough environment that corporate earnings find themselves in. When you consider that stock prices track corporate earnings over the long-run, it should come as no surprise that stocks have been turbulent lately.

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