Since the beginning of the year, the major stock market indexes have been highly volatile. The volatility has been spurred by rising tensions between the U.S. and Russia over Ukraine and the Fed’s plans to raise interest rates several times this year. Also, recently released Labor Department data shows a 7.5% year-on-year increase in the Consumer Price Index. This marks the index’s highest increase since February 1982. And the potential for the Fed to be more aggressive in combating the multi-decade high inflation could drive further stock market volatility in the near term.
However, the number of companies surpassing EPS estimates for the fourth quarter is above the five-year average. According to FactSet, more than 72% companies in the S&P 500 had reported their fourth-quarter results as of February 11, of which 77% companies have reported EPS above estimates. This compares to the 76% five-year average. In addition, more than 77% of S&P 500 companies have reported revenues above estimates, which is above the 68% five-year average.
