Market Cap Matters in Earnings Season

With the latest earnings update last week, it wasn’t noticed until post-publication, that only two of the eleven sectors of the SP 500, actually had “greater-than-benchmark” expected earnings growth.

Here is last weekend’s link.

Technology earnings are expected to grow +16.3%

Financial’s are expected to grow +11.8%.

Together, those two sectors represent 35% – 37% of the Sp 500 by market cap.

Add Healthcare’s 15% market cap weight and those three sectors comprise 50% – 52% of the Sp 500’s total market cap.

Four sectors have market cap weights of roughly 3% each:

  • Telco
  • Utilities
  • Basic Materials
  • Real estate

Market-cap matters. The best growth is earnings season is coming from the largest sectors. That usually results in bull markets.

Thanks for reading.

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