Earnings Expectations

With the First Quarter of 2009 quickly coming to a close, investor’s will shift their focus to the upcoming earnings releases.  While the last few quarters releases have been significant to the market, we feel this quarter’s releases will carry even greater weight.  What may be even more important than the numbers themselves is the rhetoric the CEO’s use to describe what they see in the future.  While it may seem oversimplified if we consistently hear rhetoric that is slightly more positive than the expectations already set by the analysts then we could continue this rally through earnings season.  However, one has to prepare themselves that if company’s do not project a more positive tone the market could back track substantially, washing out most of the gains we will have seen in March.  We will closely follow the first few earnings releases of the season to see what, if any, tone is being set. DC