With the U.S. stock market reaching new highs, investors are getting a little nervous about the future direction of stocks.

The new administration’s struggle to make progress on their agenda has put the”Trump Bump”of the stock market in jeopardy. Now that the bump in confidence has worn off, investors must focus more on underlying economic data and stock fundamentals.

July was a great time to gain some insight into the underlying health of corporate America,as it is the beginning of earnings season. As of July 28th, with a little over half of S&P 500 companies reporting earnings, 73%of them beat their earnings and sales estimates (Source: FactSet).

Either because of fundamentals or the expectation of the current administrations ability to pass a tax reduction package and/or a modification to “Obamacare”, the market continues to rise. The growth is sluggish; however, it is still growth…and investors have historically fared well when the economy grows.

The link below is to a graphic from the Wall Street Journal that you might find interesting.

Wall Street Journal Image