The stock market was turbulent on Thursday morning, initially reacting positively to strong economic data but then giving up some of its early gains. Investors are pleased to see COVID-19 vaccination efforts and economic stimulus provide support for Americans, but with many stocks having already seen big gains in anticipation of a recovery, it's not always clear to what extent current share prices already reflect anticipated good news. As of 11 a.m. EDT, the Dow Jones Industrial Average (^DJI -1.24%) was up 34 points to 33,854. The S&P 500 (^GSPC -1.46%) rose 15 points to 4,199, while the Nasdaq Composite (^IXIC -1.62%) climbed 18 points to 14,070.

Investors are scouring through earnings reports to get any insight they can about the pace and sustainability of the rebound in the U.S. economy. The latest reports from McDonald's (MCD -0.46%) and Caterpillar (CAT -1.71%) gave two different perspectives on the current environment, and they also showed just how ambivalent investors are in evaluating what near-term results truly mean for a company's long-term prospects. Below, we'll take a closer look at these earnings reports.

Glittering golden arches

Shares of McDonald's moved up about half a percent on Thursday morning. The fast-food giant reached a key milestone, and shareholders seem to be excited about the company's prospects to sustain its current growth pace.

The exterior of a McDonald's restaurant in Barstow, California, as seen at night

Image source: McDonald's.

Perhaps the most encouraging thing McDonald's said was that its comparable sales globally climbed above their levels from before the pandemic in the first quarter of 2019. That included a strong year-over-year 7.5% jump in comps, led by a 13.6% gain in comparable sales among U.S. locations. Earnings per share saw even bigger gains of 31% from year-ago levels.

McDonald's attributed the strong performance to several factors. Customers spent more on average on their meals, thanks in part to an attractive menu and successful marketing. Growth in delivery and digital ordering platforms were also contributors to the revenue gains. Internationally, restrictions on restaurant operations due to COVID-19 played a much larger role, keeping growth abroad largely in check.

Most investors expected a disparity between U.S. and international operating results, given different ways of handling the pandemic. However, it appears that McDonald's has tapped into favorable trends that could well persist long after conditions have returned to normal in many of its markets.

Caterpillar's business builds up steam

Elsewhere, Caterpillar's stock fell 2.5%. The move in the Dividend Aristocrat's shares came despite promising results from the heavy construction equipment manufacturer's first-quarter financial report.

Caterpillar's revenue climbed 12% during the period compared to the year-ago quarter, with strength both from end users purchasing equipment and from dealers replenishing their inventories. Dealers in particular are expecting a big rebound in customer purchases, and they spent a lot more to make sure they'd have equipment on hand than they did in the first quarter of 2020. Bottom-line results were also impressive, as Caterpillar's adjusted earnings of $2.87 per share was up almost 75% year over year.

Interestingly, Caterpillar saw very different geographical trends than McDonald's. Caterpillar's strongest growth came from the Asia-Pacific, Latin America, and greater Europe segments. North America was essentially flat. The construction business segment dominated sales growth, with top-line gains of 27% easily topping the 6% rise in resource industry segment sales and the 4% gain from energy and transportation.

Caterpillar sees North America starting to carry its weight, especially in the construction industry. That could spur further gains for the business throughout the rest of 2021 and beyond.

Short-term stock movements don't always follow business results

The lesson for investors here is that you can't count on stock prices rising even after favorable earnings reports. Caterpillar's stock has doubled in the past year, while McDonald's has seen gains of around 25%. That's why the stock market could see a pullback even if earnings season continued to go well.

In the long run, though, stocks perform in line with their underlying businesses. In that light, both Caterpillar and McDonald's took steps in the right direction on Thursday.