With earnings season now 75% complete, investors have a pretty good idea of how things are shaping up. The average stock that has reported so far this season has gained about a half a percent on its report day (for stocks reporting after the close, we use the next day's change), which is a strong reading compared to past earnings seasons. The performance numbers vary widely by sector, though.
Below is a chart showing the average 1-day change for stocks reporting earnings by sector. Five sectors are performing better than the overall average of 0.5%, while five are performing worse. There are three sectors whose stocks are averaging declines on their report days -- Financials, Energy and Consumer Discretionary. For investors heavily overweighted these sectors, it's been a rough earnings season since most stocks are going higher on their report days.
The big winners have been Technology and Industrials. Stocks in the Industrials sector have averaged a gain of 1.01% on their report days this season, while Technology stocks have surged 1.30%. Technology and Industrials are two sectors with heavy European exposure, and the fact that they're posting solid gains in reaction to earnings shows that maybe investors got too bearish on them heading into the second quarter reporting period.
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