As the Economy Cools, Stocks Heat Up
Despite fears that the economy may be slowing, earnings reports look bright
(MONEY Magazine) – When the Federal Reserve stopped raising rates in early August, after more than two years of consistent hikes, investors cheered. Then they started worrying that the economy was slowing down too much. But second-quarter earnings reports tell a different story. As a whole, results topped analysts' expectations, with positive surprises outnumbering negative ones by nearly four to one, according to Zacks Investment Research. As a result, company share prices overall appear to be holding up and, in a few cases, gaining steam. Five companies in the Sivy 70 turned in double-digit returns for the month ended Aug. 21. Leading the pack was comeback kid Cisco, whose share price rose 16.9%. Just one month before, the telecom-equipment giant had been in the red, down 10.8% for the 12-month period that ended July 19. Chipmaker Texas Instruments and Internet conglomerate InterActiveCorp also saw turnarounds. Both companies are up 16.7% after losing money the previous month. Read editor-at-large Michael Sivy online every Tuesday at cnnmoney.com/sivy. E-mail him at msivy@moneymail.com. |
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