What we need to move markets to new highs in second half

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Let's face it. It's been a pretty crummy first half of the year for earnings, and worse for revenues.

Right now, analysts are expecting declines in both earnings and revenues for the second quarter, though earnings will likely move into positive territory as the companies begin to report.

And there are similar problems for the second half. Earnings are facing two significant headwinds:

1) No revenue growth

Unfortunately, the trend in the second half is depressingly similar to the trend in the first half: a modest, low-single digit increase in earnings, but revenues continue to veer between flat to declining.

The fourth quarter, for example, is expected to see earnings gains of 3.4 percent, but revenues are expected to be roughly flat, up only 0.7 percent, according to S&P Capital IQ.

Read More Economy on the mend, but profit drivers look weak: Strategist

Blame it on the slow growth in the economy, if you want.

Regardless, better than expected earnings, weaker than expected sales. That is a problem.

It's a problem because if you really want to kick start a second half rally and move stocks to new highs, you will need to see sales pick up. You will need to see capital spending pick up. You will need to see less emphasis on cost cutting and share buybacks.