Brace, brace.

Westminster is winding down, schools have (mostly) broken up for summer, Paris is preparing for the annual August exodus . . . but investors on both sides of the Atlantic still have to make it through one of the busiest weeks of the year for corporate reporting.

Some 40 per cent of the companies listed on the S&P 500 index of US stocks are due to report second-quarter results this week, with more than 60 of those updating the market on Wednesday, the busiest day of the quarter, according to data from Bank of America Merrill Lynch. More than twice as many S&P 500 companies will report between today and Friday than any other week during the three month period.

Wall Street analysts have been busy scrambling to update forecasts for this week’s earnings after a record proportion of the early reporters beat market expectations on earnings per share and sales last week, according to BAML. Investors have responded with a muted reaction to outperformance. Companies that outperformed earnings and revenues expectations have only risen by an average of 1 percentage point more than the market the following day. However, investors have punished underperformers who miss expectations more heavily than usual, with their stocks lagging the market by an average of four percentage points, according to BAML.

The clustering of companies reporting is good news for stockpickers, BAML notes. The average dispersion — or standard deviation — of daily stock returns measured over the past nine years is consistently higher for busier reporting days.

‘’It’s early days for Q2 earnings season, but so far this is looking to be a very good reporting cycle’’ notes Nicholas Colas at Data Trek. But there is one troubling sign in that Wall Street analysts are trimming Q3 forecasts across most sectors. Mr Colas notes that consensus estimates for Q3 earnings growth are down from 21.6 per cent on June 30 to a current 21.5 per cent.

Over in Europe, things are slightly quieter.

Across the UK’s FTSE 100, just under one-fifth of companies are expected to report before the end of the week, with the bulk of those doing so on Wednesday and Thursday. Between the FTSE 350 and the major European bourses — the CAC 40, the Dax, the FTSE Mib and the Ibex 35 — there are comfortably over 100 companies due to publish results, according to data from Bloomberg.

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