16/04/2015 17:12
U.S. stocks edged lower on Thursday as corporate results showed little organic growth even as they largely beat profit expectations.
While Netflix surged following blockbuster results, curbing the decline on Nasdaq, shares of SanDisk slumped following a weak revenue outlook that added to concerns about the pace of top-line improvement.
Of the 36 companies in the S&P 500 that have reported thus far, 81 percent exceeded profit expectations, well above the long-term average of 63 percent. Only 47 have beaten on revenue, however, below the historical average of 61 percent. That suggests companies are boosting their bottom lines with cost cuts rather than through business expansion.
"This is a pricy market. It needs earnings to sustain it, and the earnings need to be sustained by strong demand. Right now I'm not thrilled with the level of revenue growth we're seeing," said Uri Landesman, president of Platinum Partners in New York.
First-quarter profits for S&P 500 companies are seen falling 2.6 percent, according to Thomson Reuters data, eroded by low oil prices, a strong dollar and extreme weather in the eastern United States.
While Netflix surged following blockbuster results, curbing the decline on Nasdaq, shares of SanDisk slumped following a weak revenue outlook that added to concerns about the pace of top-line improvement.
Of the 36 companies in the S&P 500 that have reported thus far, 81 percent exceeded profit expectations, well above the long-term average of 63 percent. Only 47 have beaten on revenue, however, below the historical average of 61 percent. That suggests companies are boosting their bottom lines with cost cuts rather than through business expansion.
"This is a pricy market. It needs earnings to sustain it, and the earnings need to be sustained by strong demand. Right now I'm not thrilled with the level of revenue growth we're seeing," said Uri Landesman, president of Platinum Partners in New York.
First-quarter profits for S&P 500 companies are seen falling 2.6 percent, according to Thomson Reuters data, eroded by low oil prices, a strong dollar and extreme weather in the eastern United States.
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