First-quarter earnings have continued to come in strong, though Big Tech is very much in the driver’s seat.
Some 90% of the companies in the S&P 500 have reported their latest results through Friday, according to FactSet, with the numbers pointing toward overall year-over-year growth of above 13%. If that holds, it would mark a second-straight quarter of double-digit growth, FactSet said. Companies are beating estimates at a rate just above the five-year average, but to a slightly smaller degree.
Nvidia’s (NVDA) numbers aren’t in yet—they’re due later this month—but first-quarter earnings from mega-cap tech stocks are so far up 28% year-over-year, compared with 9% for the rest of the S&P 500, Goldman Sachs analysts wrote Friday.
That Nvidia report will still be closely watched as investors look for more clues regarding the outlook for AI growth and Big Tech broadly. This week, however, investors may largely be looking instead at trade and inflation—U.S.-China trade tensions show signs of easing after a pullback in reciprocal tariffs was announced, and April’s CPI report is due tomorrow.
First-quarter earnings “appear solid but increasingly stale, as the trade shock has materially altered the outlook,” BCA Research wrote in emailed comments Monday. Trade-related optimism was lifting stocks Monday morning; Investopedia’s live coverage of today’s trading is here.
“This pause gives U.S. companies more time to adapt and to plan for contingencies should the trade talks go sideways again,” wrote Harris Financial Group Managing Partner Jamie Cox earlier today.
Walmart (WMT), Applied Materials (AMAT) and Take-Two Interactive (TTWO) are among the companies of note set to report this week. A more detailed roundup of the week’s key events is here.