Corner of Wall & Main: No More Empty Pockets

By

Chris Versace and Lenore Hawkins

 | Jul 09, 2014 | 6:00 PM EDT
  • Comment
  • Print Print
  • Print

Tuesday, the S&P 500 experienced its biggest one-day drop since mid-May as earnings season kicked off and market participants looked to see if second-quarter performance supported the current 18x price-to-earnings ratio on reported earnings, which is well above the 13.8 median for the S&P 500 since the mid-1970s. Annual earnings growth for the S&P 500 sits at 5.4% vs. 3.4% for the first quarter, again bucking the historical trend for declining forecasts throughout any given year. The S&P 500 has yet to experience a 1% or more decline in 56 days and is optimistically priced heading into the reporting period.

Meanwhile, European markets have experienced four straight days of declines with grim economic data coming out of Germany and the U.K., while volatility is finally emerging after three months of relative calm, up 16% in the past two sessions, though still down 13% for the year and bouncing around seven-year lows. As you might recall, in May we suggested adding iPath S&P 500 VIX ST Futures ETN (VXX) to your portfolio as insurance at the end of May.  ...551 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

Read the full story and get access to the Real Money trading floor.
There’s no substitute for a trading floor to get great ideas, so Jim Cramer created a better one at Real Money and blogs there exclusively. Staffed with nearly 3 dozen investing pros, money managers, journalists and analysts, Real Money gives you a flood of opinions, analysis and trading advice found nowhere else, and allows you to interact directly with each expert.

Already a Subscriber? Please Login
Except as otherwise indicated, quotes are delayed. Quotes delayed at least 20 minutes for all exchanges. Market Data provided by Interactive Data. Company fundamental data provided by Morningstar. Earnings and ratings provided by Zacks. Mutual fund data provided by Valueline. ETF data provided by Lipper. Powered and implemented by Interactive Data Managed Solutions.


TheStreet Ratings updates stock ratings daily. However, if no rating change occurs, the data on this page does not update. The data does update after 90 days if no rating change occurs within that time period.

IDC calculates the Market Cap for the basic symbol to include common shares only. Year-to-date mutual fund returns are calculated on a monthly basis by Value Line and posted mid-month.