Morgan Stanley || The first results of the season in the United States have had a bias of 79% towards EPS beats (vs 74% in Q4) and 70% towards revenue beats (vs 65% in Q4). Although the pace of beats is positive, it is difficult to draw firm conclusions for now as only 31 companies in the S&P 500 have reported results.
In fact, in a more negative tone the earnings revisions in the United States have begun to deteriorate: the breadth of FY2 earnings revisions to 1W is in negative territory and at 1M they have practically reduced to 0. It will be more relevant to observe where these indicators stand in a couple of weeks, but for now the trend in EPS revisions in the United States is not heading in the right direction.
In contrast, although the price reaction to some of the first results in Europe has been negative, the 1W EPS revisions for the S&P 500 are currently positive and the strongest in the last 5M while the breadth at 1M and 3M, although still in negative territory, continue to improve.