Earnings Season For Energy Group Is Looking 'Dicey,' CNBC's Pisani Says

Some of Wall Street's biggest banks reported their earnings on Friday which marks the unofficial start to earnings season, CNBC's Bob Pisani noted. Investors will most likely be treated to continuing momentum in corporate earnings, but at a time when many stock indices are trading near their all-time highs are expectations too rosy?

Investors will be looking for significant earnings growth from technology and financial stocks and a boost from the energy sector as well, Pisani continued. In fact, those three sectors combine for around 83 percent of the earnings gains many are expecting for the quarter.

But analysts have lowered their expectations for the financial sector as interest rates haven't moved up as much as expected, David Aurelio of Thomson Reuters told Pisani. There is also risk in energy stocks, especially at a time when many are expecting a 600 percent improvement in earnings after last year's "historic collapse" in oil prices.

"And this is where things get a bit dicey," Pisani stated.

Wall Street analysts modeled their second-quarter expectations for energy companies under the assumption that oil prices will be closer to $60 per barrel as opposed to the $40 to $45 range it has been trading at recently. At that time analysts were also modeling the collective energy group to earn $10.4 billion in profits but now this figure has been slashed to $8.18 billion — a drop of 25 percent in expected profits.

If it is of any solace to investors, analysts already revised their outlook for the oil sector to better reflect morality, Pisani added. However, it isn't clear sailing moving forward as any forward-looking commentary will be the driving force of energy stocks.

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