Despite some stellar earnings reports this morning, the markets still opened lower, with the S&P 500 and DJIA now just about flat for the day. Some of the earlier losses were recovered as investors reacted to the strength of today’s earnings as well as the lowest jobless claims number since 2000.
Of the 12 S&P 500 constituents that reported this morning, 7 beat the Estimize consensus, 3 missed and 2 met. The break out winner was, of course, Goldman Sachs with EPS of $4.57, a whopping $0.90 higher than the Estimize consensus, and an even higher $1.35 above the Wall Street consensus. This represents impressive YoY profit growth of 59% for the bank, and even helped to boost EPS growth for the Financials sector to 7.0%. Revenues of $8.4B also surprised to upside, beating the Estimize consensus by $306M and the Wall Street consensus by $640M. The impressive third quarter results were due to a rebound in fixed income trading which posted it’s first revenue gain in over a year, with FICC trading as a whole jumping 74%. The increase was due to strength in currencies, commodities, interest-rate products and mortgages, with some of the gains offset by weakness in credit products such as corporate bonds.The increase in trading volumes for the firm bodes well for Morgan Stanley which reports tomorrow and expects EPS of $0.57 and revs of $8.3B.
After today’s closing bell, the highly anticipated third quarter earnings report from Google will be released. The current Estimize consensus is calling for EPS of $6.56, $0.10 higher than the Street’s expectation. If the company posts earnings of $6.56 a share, this would represent a 22% increase YoY. Revenues are also looking strong, currently anticipated to come in at $13.2B, 11% higher than the Q3 2013 actual.
 With Nearly 13% of S&P 500 Companies Reporting for Q3, Where Do We Stand?
Expectations for S&P 500 earnings growth for the third quarter has risen to 9.2% in the last day due to some better than expected reports. Revenues are anticipated to come in with 4.3% growth. All 10 sectors are anticipated to post positive year-over-year growth on both the earnings and revenue front.
