Ongoing trade disputes, political divisiveness, geopolitical threats, and tense feelings about Russia meddling have no doubt weighed on investor sentiment. Though the S&P 500 is up year-to-date, volatility has been pervasive and global stocks are still in negative territory. Uncertainty hangs over the market like a dark cloud.
But there's sun poking through those dark clouds, and it's none other than U.S. corporate earnings reports! Indeed, earnings have offered a bright spot amidst the negativity, and now in their second week, earnings have been impressing the street and renewing optimism amongst investors for stocks.
Here are a few highlights from this week:
Shares of Eli Lilly were climbing Tuesday on the pharmaceutical company's announcement that it earned $1.55 billion, or $1.50 per share, which was far ahead of analysts estimates of $1.30 per share. Eli Lilly also announced that it would file an IPO for its animal health unit, which the street cheered. Last quarter, Eli Lilly's net income was $1.01 billion, or 95 cents per share. On the revenue front, Eli Lilly hit $6.36 billion, up 9% from the year-ago quarter and above estimates of $6.05 billion. Lilly has approved a plan to buy back $8 billion in stock.
In the telecommunications sector, Verizon shares were also notching higher on reported earnings of $1.20 a share, above a consensus estimate of $1.14. This is good news for the telecom sector, which has taken a beating so far this year, down some 12% year to date while the S&P 500 is in modestly positive territory. AT&T will be one to watch this week as well, to see if telecom can keep getting a much needed boost.