Should an investor try to catch any of these falling knives?

Financial journalist and commentator on 3AW and Sky Business
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We’re coming into a reporting season – half-year to December 31 for most companies, but full-year results for those which use the calendar year as their financial year – and that can only mean one thing: “confession season” is ending.

Just as there are two reporting seasons – February and August – there are two confession seasons, one in December-January and the main one, April-June (early confessions come after companies see their results for the March quarter.) If the companies realise that they are unlikely to meet their own “guidance” for expected profits – often expressed as a range – or the market’s expectations, based on analysts’ current consensus estimates – they tell the market about it.

And depending on what the market was expecting, these revisions to outlook can have a severe impact on share prices.

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