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Market Update

Are Strong Earnings Leading to Strong Outlooks?

Results keep coming in above investor expectations, but management teams are generally being cautious about guidance.

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Another week of earnings brought another group of better-than-expected results. This week we glimpsed a pickup in spending across a number of different segments, ranging from  Coach (COH) purses to  Microsoft's (MSFT) Windows 7.

One thing that does not seem to have blown away investors is earnings guidance. Although several firms significantly raised their full-year or second-quarter guidance, modest changes were more common. We also saw firms like  Exelon (EXC) keep the top end of their guidance unchanged while raising the low-end of the range.

Jeremy Glaser has a position in the following securities mentioned above: MSFT. Find out about Morningstar’s editorial policies.