The stock market has been supported by a healthier-than-expected economy this year, generating returns that have helped many portfolios to partially recover from last year's bear market. Investors now hope these growth trends will translate into stronger corporate earnings since, in the long run, markets tend to follow the same trajectory as profits. With the economy's future still uncertain, what signs are there that companies might begin to see improved profitability?
We discuss in this episode of The Wealth Effect Podcast:
📉 S&P 500 Earnings Growth Rates
💵 Corporate Profitability
📊 Sector Dividend Yields
Matt Faubion, CFP®
Founder - Wealth Manager
Show notes and charts:
Earnings growth may have reached an inflection point
The stock market tends to follow corporate earnings
Dividends are an essential consideration for all investors
The bottom line: Economic growth drives corporate earnings, which in turn support the stock market. Investors should follow these longer-term trends, rather than day-to-day market movements, as they work toward their financial goals.
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