Here are the notes from Standard & Poor's Investment Policy Committee meeting, held on Wednesdays.
S&P equity analysts expect third-quarter operating earnings for the S&P 500 to rise 14% from year-ago levels, marking a continuation of double digit year-over-year EPS gains. Similarly, for full year calendar 2006, we forecast S&P 500 operating EPS will rise 13%, to $86.57 per share, a new record.
S&P Equity Strategy believes recent positive momentum in the S&P 500 Index is being driven by increasing confidence in a soft landing for the U.S. economy in 2007. With investor's focus now shifting away from the prospect of tighter liquidity and towards easing liquidity, we believe visibility on healthy, albeit slightly slower, 2007 corporate earnings growth is rising.