While Alcoa (AA) reported earnings on Wednesday, no other key names are set to report until next Tuesday. On Tuesday morning, Goldman Sachs (GS) will report, and Intel (INTC) will report after the close that day. Heading into this earnings season, expectations are very high because last quarter's stellar numbers are the freshest in investors' minds. As shown below, the average US stock that reported went up 1.70% on the first trading day following its report. (For companies that report in the morning, we use that day's change, while we use the next day's change for companies reporting after the close.) The next closest quarter was +0.90% in Q1 '03. The market did extremely well following the strong numbers in Q1 '03, so the bulls like to compare that quarter with last quarter. While the positive results hopefully mean that last quarter was indeed a turnaround one for both earnings and the market, investors hoping for a repeat performance are probably wishing for too much. Let's all be happy if we get any gains.
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