The stock market has had its best annual start to a new year in decades, but corporate profits continue to show more modest improvement.
Fourth-quarter earnings season is roughly half over — 57 percent of the companies in the Standard & Poor's 500 index have reported results. Profit growth is expected to be up 6 percent over the fourth quarter of 2011, according to S&P Capital IQ. Although that's better than the two previous quarters, it’s a slowdown from robust growth during most of the quarters since the recession ended. Earnings growth is expected to slow to 1.4 percent in the first quarter.
Corporations continue to lower investor expectations. Of the 69 companies that have issued earnings guidance for the first quarter, more than two-thirds have reduced estimates.Associated Press