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The latest US quarterly earnings season has begun and that usually entails equity markets being pleasantly surprised by companies exceeding low expectations. Wall Street analysts expect a year-over-year rise in S&P 500 earnings for the second quarter of around 6.5 per cent. Add the usual "beat" factor – shorthand for the uncanny ability of companies to exceed market forecasts – of about 4 per cent and we should be looking at another quarter of double-digit profits growth.Since the first quarter delivered double-digit earnings growth for the first time since 2011, Wall Street has risen further into record territory, stretching valuations.Starting with the major S&P sectors, energy is expected to deliver a huge rise in profits thanks to very easy comparisons with the same period a year ago.Excluding energy, expected revenue growth of 4.8 per cent for S&P 500 companies drops to 3.8 per cent. That leaves technology and financials doing most of the work if S&P 500 companies are to serve up back-to-back quarters of double-digit earnings growth.
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