Sam Stovall Earnings Quotations

The market has been in an irritable mood. If earnings and guidance are good, and there are no reasons to sell, then things should work out OK.

While it is difficult to anticipate unanticipated events, investors could become increasingly concerned about oil, earnings and interest rates -- the trio of trepidation -- in the traditionally weak third quarter.

Investors are going to look at whatever economic numbers come out and say is this additional fuel for the Fed to lower rates in March. Earnings are going to continue to come out and they're likely to be negative so you're going to have earnings weighing on the market.

Basically the top ten industries were those that are economically sensitive and are bouncing back from their deeply oversold condition last year as a result of lower interest rates. We do believe the Fed will remain aggressive with its easing interest rate policy but we feel the earnings are going to be pretty bad for the first quarter, so the market is likely to tread water for awhile.

The forecast from S&P is near 18 percent growth in earnings in 1997 over 1996,

We would not be surprised to see investors take a more cautious approach by gravitating toward larger companies with high S&P earnings and dividend quality ranks.