Heading into this quarter’s earnings season investors were extremely nervous, as well they should have been, because of the terrible economic backdrop for corporate earnings. So far only a handful of the largest companies have reported, but to say that they have been a big surprise to the upside is an understatement.

Alcoa started earnings season with a pretty nice beat, which is much different than its consistent misses over the last few years. Yesterday was when things kicked into high gear, with several major companies reporting earnings. Yesterday morning Goldman Sachs blew away profit expectations, earning more than any analyst had estimated, even topping last year’s profit. Clearly Goldman Sachs has gone right back to the position it was in before the financial crisis, as the clear leader in the industry. The company that many like to call gold mine will indeed be able to be called that again now, at least for the time being. Also yesterday morning Johnson and Johnson beat earnings estimates by earning $1.15 per share. The company also reaffirmed expectations for the entire year.

The biggest surprise of them all came yesterday evening when Intel delivered an absolutely brilliant earnings report that stunned Wall Street. Revenue was expected to come in at 7.28 billion dollars and the company brought in 8 billion. Earnings per share were 18 cents versus analysts estimates of 8 cents per share. Strategists are calling this beat phenomenal and saying that the company hit one way out of the park on this report.

What does all of this mean anyways? It could mean that corporations are doing a solid job of adapting to the new economic environment. It could also be that we have just seen a small amount of companies that have reported, and the companies that will report later on will not issue such positive forecasts. It is fair to say that if earnings continue to come in this strong over the next few weeks the stock market will likely respond well and the overall economic picture will improve quite a lot.