TV

Angus Walker
Bob Johnson, Director of Economic Analysis at Morningstar research, highlights some fascinating data from the US auto industry. While production and sales have almost got back to 2005 peak levels, employment in the auto industry is only around three quarters of what it was almost ten years ago.
Article / 01 August 2011 at 6:29 GMT

Earnings Season Face Off – Western Europe KO'd by America!

With approximately a quarter of the companies having reported in Western Europe and North America we evaluate how the earnings season is shaping up.
 
U.S - You Beauty!
Surprisingly, the U.S. has experienced positive Sales Growth and Sales Surprises across the board with average increases of 12.5% and 2.7% respectively. Earnings are up by an average of 18.5% with the commodity related sectors Basic Materials and Oil & Gas up a whopping 45.2% and 49.6% respectively. Chart 1 below illustrates a break down of the season thus far and overlays the performance of the S&P 500. Interestingly, investors appear more focused on macro concerns and their effect on future earnings of companies (with the S&P500 declining in the last week) than the presently impressive earnings season.  

Europe - Ugly Duckling!
Europe, on the other hand, is another story as shown in Chart 2 below. Whilst EPS growth remains mixed, EPS Surprise is negative for all the sectors (average of -11.5%)  except Basic Materials. Consumer Services performance is astonishing with negative EPS Growth and EPS surprise of 71.5% and 63.8%! Earnings within Europe are being affected by continued cost inflation, ongoing  EUR strength vs. the USD and ‘mismanaged’ earnings expectations leaving investors and analyst hopes dashed.

If the earnings season continues in this fashion Western Europe is set for a bumpy ride!

Disclaimer

The Saxo Bank Group provides an execution-only service and all information provided on Tradingfloor.com is solely for general information. When trading through Tradingfloor.com your contracting Saxo Bank Group entity will be the counterparty to any trading entered into by you. Tradingfloor.com does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. Saxo Bank Group will not be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available as part of the Tradingfloor.com or as a result of the use of the Tradingfloor.com. Any information which could be construed as investment research has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such should be considered as a marketing communication. Furthermore it is not subject to any prohibition on dealing ahead of the dissemination of investment research. Please read our disclaimers:
- Notification on Non-Independent Investment Research
- Full disclaimer

Show latest activity
Dismiss
Sorry, there was a problem communicating with the TradingFloor.com servers. We are working hard to solve this. Please try again later.
Oops! There was a problem communicating with the OpenAPI Portfolio service.
Oops! There was a problem communicating with the OpenAPI History service.
Oops! There was a problem communicating with the OpenAPI Reference service.
Oops! There was a problem communicating with the OpenAPI Root service.
Oops! There was a problem communicating with the OpenAPI Trading service.
Sorry, there was a problem communicating with the Financial Calender servers. We are working hard to solve this. Please try again later.
Check your inbox for a mail from us to fully activate your profile. No mail? Have us re-send your verification mail