The focus of investors during the current period is directed to the US company’s earnings results for the last quarter of the year 2022, as it was a year full of
economic and political events that affected the performance of companies in general.
The following is a calendar of the results of the major companies that will announce their earnings next week:
The terms inflation and recession were the most prevalent during the year 2022, as inflation in the United States reached its highest level in 40 years, which made
the US Central Bank take a strict monetary policy in order to fight inflation, and the Federal Reserve raised interest rates to 4.5% during 2022, which increased
the possibility of an economic recession, how did this affect the results of the US companies?
During 2022, US stocks recorded their largest annual loss since the 2008 financial crisis, with the S&P 500 index closing down by 20%, and technology stocks
were particularly affected, with the Nasdaq index falling by about 33% and being the most affected, given that technology companies are exposed to fears of
higher interest rates because many of them are evaluated on the basis of expected profits that will be achieved for years in the future.
As a result of economic uncertainty, major companies such as Twitter, Meta, Amazon, Microsoft, and Goldman Sachs Bank announced layoffs and slowed the pace
of hiring new employees in order to increase profit margins and reduce costs. Profits are expected to fall 2.8% year on year, according to Wall Street estimates in
the fourth quarter, revenue for S&P 500 companies fell only 4%. According to previous Fed statements interest rates are expected to remain high throughout
2023, and inflation will remain higher than the Fed's target of 2% Therefore, analysts expect that corporate profits will continue to be under pressure as a result
of high inflation and as a result of high interest rates.
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