It's that time again. Second-quarter earnings season kicks off Monday when Dow component Alcoa reports after the bell. CNBC Managing Editor Tyler Mathisen talked to Bob Pisani at the New York Stock Exchange to get a sense of Wall Street's expectations.
First-quarter earnings beat analysts' estimates even with the sluggish U.S. economy, Pisani noted. The consensus going in was 4% growth but results ended up closer to 7%. Pisani expects to see a similar pattern the second quarter, despite some of the projections companies have offered up so far.
"The bulls are betting that the numbers are going to come up very quickly in the next couple of weeks," he said.
Even though the bulls are setting market expectations right now, they're not completely invulnerable. A few big companies missing the mark could turn the roaring Dow around. "If we get some key companies that come out and disappoint, the market will definitely change quickly," he said.
In addition tothe energy sector and cyclicals staying strong, look for health care stocks among the winners. They beat expectations in the first quarter, Pisani noted, and will likely repeat in the second.
"These stocks have been generally pushed aside in the general rally we've seen in the last year," he said. "Health care is one of those more defensive names that in this kind of economy doesn't get a lot of attention, yet their earnings were terrific in the first quarter. They will be one of the two strongest sectors in the second quarter, industrials being the other."
As for the rest of the year, earnings growth is expected to continue at a healthy pace.. "We're expecting about six percent in the third quarter earnings growth in the S&P 500, and 12 percent in the fourth quarter," Pisani said.