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On Friday, world stocks dipped by Exxon and JPMorgan Chase. Strong quarter is wrapped up by investors and they are looking if the justification will come on market’s lofty valuations by corporate earnings reports.

Following the election of Trump, major indexes have hit a series of record highs. As he has promised that he would cut taxes and boost infrastructure to improve economic growth. A raft of strong economic data has been proven beneficial for the rally and a pickup has been seen in corporate earnings growth.

At the end of the quarter on Friday, the Dow Jones Industrial Average was up 4.5 pct, with the S&P 500 is on track to end 5.6 % higher, which is a biggest first-quarter gain in last four years. To justify the pricy valuations, investors are now looking forward for the upcoming quarterly earnings season.

According to Thomson Reuters I/B/E/S, the earnings of first-quarter are expected to rise 10.1 percent for S&P 500 companies. As compared to the long-term average, which is 15, the index trading as estimated for the next one year is about 18 times earnings.

The expectation from S&P 500 is to rise another 2% by the end of the year .DJI, The Dow Jones Industrial Average fell 0.31% and ended at 20,663.22 points, whereas the S&P 500 .SPX lost 0.23% to 2,362.72 and the Nasdaq Composite .IXIC lost 0.04% to 5,911.74.

Looking at technology in 2017, .SPLRCT has remained as one of the top-performing S&P sectors, which is up by 12.2% and the weakest was energy .SPNY, down 7.3%. Whereas the Nasdaq gained by 1.3% and the top stock on the S&P was Amazon.com.

On Nasdaq, a 1.22-to-1 ratio favored advancers and on the NYSE by a 1.52-to-1 ratio advancing issues outnumbered the declining ones.


Aaron Hall

For any feedback and suggestions contact author at Aaron.Hall@themarketdigest.org

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