Better-than-expected earnings reported by companies in the S&P 500 IndexIn the first week of November 2017, Factset issued an update about the 3Q17 earnings season. Approximately 66% of S&P 500 (VOO) companies reported actual revenues above estimates when compared to the five-year average. These reported revenues were 1.2% above estimates and were also above the five-year average. \n\nApproximately 74% of these companies reported EPS (earnings per share) above estimates when compared to the five-year average. The reported EPS figures were above the five-year average and 4.8% above estimates.In 4Q17, 51 companies in the S&P 500 Index have issued positive EPS guidance, while 26 companies have issued negative guidance.IBM’s role in the S&P 500 rallyAs the chart above shows, the IT sector led the “upside earnings surprises reported by companies in multiple sectors” in the S&P 500 Index. The IT (QQQ) sector and Energy and Materials were featured among the nine sectors that reported year-over-year (or YoY) growth in revenues.\n\nTechnology players Apple (AAPL), Amazon (AMZN), Intel (INTC), Alphabet (GOOGL), and Microsoft (MSFT) have reported stellar earnings this season and contributed to the S&P 500 rally. The market’s optimism is apparent in their stock prices, which have risen in double digits year-to-date.\n\nOn October 18, 2017, with an 8.9% appreciation in its stock price, IBM was one of the S&P 500’s top gainers. IBM announced its 3Q17 earnings on October 17, 2017. IBM’s earnings not only exceeded analysts’ expectations but also provided a favorable outlook for the current quarter.Revenue trendAlthough IBM continued its no-growth revenue trend with its 3Q17 earnings, its earnings beat analysts’ expectations. In fiscal 3Q17, IBM reported revenues and non-GAAP[1. generally accepted accounting principles] EPS of ~$19.2 billion and $3.30, respectively, which beat analysts’ expectations by $550.0 million and $0.02, respectively.\n\nIBM’s management expects its fiscal 2017 EPS to be at least $13.80 per share, higher than the analysts’ estimate of $13.75. Its 4Q17 revenues are expected to be $22.0 billion–$22.1 billion, higher than analysts’ expectations of $21.8 billion.\n\nAs a result, IBM rose 8.9% to $159.53 on October 18, 2017—its highest close since April 28, 2017.