Paul Tracy

In the late 1990s, networking giant Cisco Systems (Nasdaq: CSCO) and the company's CEO, John Chambers, became famous for consistently beating Wall Street's earnings expectations and seeing a big one-day pop after each quarterly earnings release. 

The strong momentum in Cisco's business in the late 1990s was one reason for the firm's consistency. But many investors credited Chambers, saying he was a master at keeping earnings expectations low enough that he could over-deliver and impress analysts. 

There are many fundamental, macroeconomic and psychological factors that move stocks or the market as a whole. Last summer, the debt crisis in Europe was in the front of most investors' minds, prompting some wild sell-offs in global stock markets regardless of corporate fundamentals. And, in recent weeks, traders have become increasingly concerned about some softening in U.S. economic data, a bright spot for the world economy since late last year. 

But short-term moves aside, stocks are ultimately valuable because they produce a stream of profits and dividends for their shareholders over the long term. A sustained rise in earnings will tend to support a rally in a stock over the long haul. And there's nothing that will attract income-oriented investors faster than a company with a solid yield that's able to steadily raise its dividends over time, supported by a commensurate rise in its earnings stream.