Healthcare, Financials Will Fare Well During Q2 Earnings Season

The barrage of crises roiling the market - from China to Greece to Puerto Rico to the inner workings of the NYSE – are more of a passing shower than a perfect storm, according to Gina Martin Adams, senior analyst at Wells Fargo Securities. 'None of these issues are likely to become long term problems for the U.S. economy,' said Adams, adding that a significant slowdown in China or continued problems in the Chinese stock market might cause her to change her mind. Adams said that investors will get a chance to better assess the fundamentals of corporate America next week when second quarter earnings season begins in earnest. She is looking for the S&P 500 to beat earnings expectations for the period with about 2% growth. The consensus is looking for a 3% contraction in earnings year on year, according to Adams. 'Outside of the energy sector, we likely see most of the S&P produce earnings growth,' said Adams. 'Not a huge acceleration from the first quarter, but steady growth.' She also does not see currency exchange rates weighing on multi-national earnings in the same manner that it did in the first quarter when the dollar flexed its muscles against the Euro.

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