Solid Q4 Earnings

We are done with a majority of 4th Quarter corporate earnings reports, with over 55% reporting so far.

70% of companies have beaten consensus expectations. That is a relatively high amount. Technology is showing particular strength with over 90% of technology companies coming in ahead of consensus.

The market is also hitting new highs in several metrics not just price. Breadth, or the number of stocks hitting new highs, is particularly important for the longevity of the advance. It is extremely rare to see a major top in the market if the majority of stocks participated in making the new high, which they just did.

The Coronavirus remains a worry and we are keeping a close eye on it. Many Chinese factories restarting this week is a good sign. It does appear though that containing this virus will be a tall order. This is where traders get excited, long term investors stay the course the in between types sometimes make huge mistakes. Best bet – stay long.

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