If you were dreading first quarter earnings season, you’re probably feeling some relief now. Although earnings in the financial sector were dreadful, many investors are happy that things weren’t worse.
Excluding financials, results for S&P 500 firms were up over 7-percent, in line with the long-term historic average for the market as a whole. And, although profits at financial firms fell 79% in the first quarter, that’s still better than the fourth quarter -- when the sector lost money.
Consumer Discretionary was the only other negative sector. It fell 23%. Some sectors, like energy and consumer staples, actually rose double digits.
Look for more of the same pressures in the second quarter. Financials and Consumer discretionary are expected to be the worst performing sectors again.
The question I want answered is whether it’s too early to buy into downtrodden areas like financials and consumer discretionary.
What do you think?
