LIVE MARKETS-'Earnings rule': Why markets are brushing off trade tensions

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"EARNINGS RULE": WHY MARKETS ARE BRUSHING OFF TRADE TENSIONS

Trade tensions, dollar doubts and warnings of systemic shifts have made headlines recently, but financial markets remained largely unfazed.

Pareto chief economist and strategist Finn Oystein Bergh points to the resilience of corporate earnings as the key reason, noting that the full impact of Washington's protectionist policies may take years to unfold.

"The most important explanation, though, is probably the strength of listed companies – on both sides of the Atlantic," he writes in his latest monthly report.

Forward earnings estimates are rising for both the S&P 500 .SPX and Europe's STOXX 600 .STOXX, he notes. "If there is a structural change underway, it is not yet priced in by financial markets. For now, earnings rule."

Despite concerns over Trump-era tariffs and fiscal policies, and renewed scrutiny of the U.S. dollar's global role, Bergh sees resilience in corporate fundamentals.

"We do find many governments badly run, but we also find a large number of companies that are very well run indeed – and that's where we put your money."

And for investors? "You can go on vacation without losing sleep."

(Danilo Masoni)

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EARLIER ON LIVE MARKETS:

INSURERS AT NEW PEAK, RUSSIAN PLAYS UP, DEFENCE DOWN CLICK HERE

BEFORE THE BELL: TARIFFS, CHIPS AND EARNINGS CLICK HERE

SPLIT BANK OF ENGLAND SET TO CUT RATES CLICK HERE