Welcome to the weekend, folks, and for most of you it's a long weekend since Monday is Memorial Day. We won't be publishing that day, as the market will be closed and there's obviously not going to be much to talk about. We'll be back in the saddle on Tuesday though, doing our usual thing. In the meantime we've got just a couple of items of business to take care of before all you guys and gals get started on whatever it is you have planned for the next three days. First (but not foremost), last month's consumer inflation levels were a bit higher than expected. Then again, economists weren't expecting much. The pros were looking for a 0.1% month-to-month rise in overall inflation, and got it. On a core basis though - not counting food and energy costs - inflation grew 0.3% rather than the expected 0.2%. Don't sweat it, however, because it's still not much. The annualized "inflation rate" remains negative. In fact, for April it was even more negative than it was in March. The annualized consumer inflation rate now stands at -0.2%. On a core basis though, it's still a more-normal 1.8%.... which I suppose only matters to those of us that don't eat or use gas. With or without the impact of uber-cheap oil, the tepid inflation picture continues to call into question the need for higher interest rates. We've (rhetorically) asked several times now why the Fed's stance seemed like one that was all for lifting rates ASAP, and today's data underscores the question - what inflation needs to be contained? The bond market basically started to wonder the same thing, sending yields down a little more today before managing to pick them back up slightly above yesterday's pullback levels. I still get the feeling we're going to see rates edge at least a little lower from here, however, now that the pressure for quick action from the Fed has been abated for another month. Don't get the wrong idea there. We still believe rates are ultimately going to go higher, and could make a much firmer upward move if-and-when the 30-year treasury yield punches through the recent ceiling at 3.1%. For now though, I've still got a feeling rates are headed a bit lower from current levels. Now, with all of that being said.... It may well be the case that worrying about interest rates and when or if the Fed hikes rates is a waste of time. I wish I could give you the whole shebang about what the Elite Opportunity has been telling its members about interest rates, but we just don't have time or room. I think this snippet from Wednesday's EO newsletter, however, pretty well sums up John Monroe's thoughts on the matter. He said: "Although most market participants continue to believe that would be good for stocks, we're still convinced the focus needs to be on second quarter GDP growth, which isn't slated to come for a few months, as well as trending unemployment and new jobs numbers, which we'll have an opportunity to assess much more often. I say this because we've made it pretty clear in an economic contraction of sorts, falling rates are an indication the Fed doesn't think things are going all that well, and unlike much of the underlying economic catalyst that has helped this long-term rally along for years now being one more of an expansion phase, we just don't believe falling rates again are going to do the markets all that much good. We could be wrong, however, our research has confirmed on a historical basis for this to be true. Furthermore, we're still concerned over the lackluster consumer, which we strongly believed should have picked up their spending over the last few quarters, and that clearly hasn't been happening. Even with lower oil prices and a much stronger dollar, it just hasn't seemed to help spur any excitement at all with respect to the consumer." I have sneaking suspicioun John's exactly right - we're all so consumed about the when and where and how regarding interest rates we're missing the subtle shifts that mean so much more. This is largely why we're taking a closer look at marketwide earnings today.... earnings are going to drive stocks a heck of a lot more than interest rates will. In fact, I'm not so sure slightly higher interest rates are going to have an impact on earnings at all in the near future. Q1 Earnings - (Almost) Final Report Card Standard & Poor's finally updated what's going to at least start our last look at the first quarter's earnings season. I say "start" because we're actually going to break this analysis up into two parts, saving the more detailed (sector-level and profit-margin details) stuff for next week. For today though, we at least want to plant a seed and show you the bigger picture. Bottom line? With 97% of the S&P 500's constituents having reported Q1 numbers, the S&P 500 has "earned" $25.80 per share. That's 5.5% less than the market earned in the first quarter of 2014. But, 100% of that 5.5% decline in the S&P 500's earnings last quarter is attributable to the energy sector's implosion. In fact, more than 100% of last quarter's relatively weak results can be chalked up to trouble on the energy front. Removing the setbacks suffered by the energy and materials sectors, earnings actually grew by an average of 9.1% on a year-over-year basis last quarter. That's actually not bad given the problems caused by the strong U.S. dollar in Q1.Of course, considering the energy sector normally makes up 14% of the S&P 500's revenue while the materials sector makes up 4% of it, weakness from those areas can't simply be ignored. Like we said, we're going to take a closer look at sector-level earnings details next week along with a deeper look at profit margins and their outlooks. For today we just wanted to give you the trailing data and revised earnings outlook for the overall market. Here's the graphical look, complete with trailing and forward-looking valuations. Both are sky high right now, even with the uptick in earnings growth expected for next year. And, here's the table, with all the details to the changes. Notice we've already started to reel in the outlooks. Told ya so. We're going to talk about it in more detail next week, but since we opened this can of worms today, we'll at least go ahead and show you the expected earnings growth by sector. You can see every area except energy and materials actually made forward progress. All in all, Q1 earnings season wasn't bad. The energy sector spoiled it, but the problems were contained within that sector. Ho-Hum This is going to be short and sweet, since stocks didn't do anything interesting today. The S&P 500 is still holding above what's become a floor around 2119, but is still being held back by a newly-developed ceiling at 2133. And, the VIX is still finding support at a fairly big floor around 12.1. I really think traders mentally - and literally - checked out early today to get a headstart on a three-day weekend. This lethargy won't be around when trading resumes on Tuesday though, so be sure to check in then. In fact, look for the newsletter before the open on Tuesday, as we've got something special on the schedule for you then.