US Corporate Earnings Impress, Sentiment Improves, USD/JPY Jumps
Today is the day we get the US corporate earnings for the first quarter (Q1). They were published a short while ago and they were positive to say the least.
Caterpillar earning per share (EPS) jumped to $1.28 from the $0.62 3 expected, McDonalds EPS came out higher at 1.47 from the $1.32 expected and EPS also jumped to $2.61 from the $2.07 expected.
Revenue also increased for the biggest US corporations; Caterpillar had revenue of $9.8 billion as opposed to the $9.36 billion expected for Q1, while Coca-Cola had $9.13 billion.
Apple had a great quarter too with revenue of $78.4 billion and $3.36 EPS, both of which are new records for the giant corporation.
This shows that US companies have been doing pretty well in Q1 which means that the broader economy has been doing well too.
These numbers show that the global economy is in a decent shape as well, particularly after seeing Caterpillar numbers, since Caterpillar sells heavy machinery across the globe.
The better earnings and revenue are supposed to improve the market sentiment and we´re seeing the consequent action in the forex market.
USD/JPY has gained about 25 pips since the release and it just broke above 110.50. I mentioned in the first update this morning that 110.50 would be a good place to open a short term sell forex signal. However, this report changes things since the market sentiment is a tad better off and USD/JPY buyers are a bit more confident.
The improved sentiment is hurting the other safe haven currencies. The Swiss Franc is a bit weaker now, which is pushing EUR/CHF higher. We have an open signal here so let´s hope the sentiment turns sour again, at least until we get our pips from this signal.
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