Bloomberg Intelligence's 'Equity Market Minute' 2/3/2022

The video discusses the S&P 500's fourth-quarter earnings, highlighting that companies are largely beating expectations, but analysts are lowering future earnings growth forecasts due to margin concerns. Fourth-quarter earnings are expected to grow by 24%, surpassing initial expectations of 20%. However, forecasts for the first, second, and third quarters are declining, despite rising sales forecasts. Net income margins are above expectations for the fourth quarter, but future margin forecasts are being marked down. This trend affects 75% of industries and nearly half of companies, making it challenging for the S&P 500 to regain an uptrend.

What is the main reason analysts are reducing their future earnings growth forecasts?

• Higher than expected earnings

• Stable operating margins

• Declining net income margins

• Increasing sales forecasts

How much earnings growth was initially expected for the fourth quarter?

• 24%

• 18%

• 20%

• 22%

Despite rising sales forecasts, what trend is observed in earnings expectations for the first three quarters?

• They are stable

• They are declining

• They are increasing

• They are unpredictable

What percentage of industries have seen a reduction in forward margin expectations?

• 50%

• 75%

• 25%

• 100%

What challenge does the S&P 500 face due to declining margin forecasts?

• Difficulty in increasing market share

• Difficulty in re-establishing an uptrend

• Difficulty in reducing sales forecasts

• Difficulty in maintaining current levels