Investment Banks talk about S&P earnings relative to the S&P500 index
(65 for 2004 expected on an index of 1150).
I would like to know that that means in absolute $ values for both the
total market cap and the earnings.

Hello.

The market value as of 4/1/04 of the S&P 500 is $10.5 trillion.

The Chicago Board Options Exchange provides a list of the market value
of each component company of the S&P 500 index and the percentage that
the company represents of the index.
http://www.cboe.com/OptProd/snp500.asp

From this data, we can easily determine the total market value of the S&P 500. 

The market cap of General Electric (GE) is $312,264,413,480.  That
represents 2.97% of the S&P 500.

312,264,413,480
--------------- = $10.5 trillion
.0297  	


Or Microsoft (MSFT)...

270,615,432,510  	
--------------- = $10.5 trillion
.0257


****************************************

As to the earnings question, if the earnings ratio is 65 for 2004
expected on an index of 1150, we can simply apply this to $10.5
trillion to get a $ value for the earnings:

65/1150 * $10.5 trillion = $593 billion

---------

search strategy:
"cap of the s&p 500" 
which led me to this page (that linked over to the CBOE site):
http://apm.slu.edu/data.htm

I hope this helps.

Your answerer referred to the market cap, but failed to address the
question of earnings.

Companies typically estimate next-year earnings in their annual
reports.  These earning estimates are non-independent and can be up to
11 months out-of-date by the time companies report their next set of
accounts, so investment banks typically forcast their own earnings
estimates, as do independent agencies.

The point of looking at prices and earnings is to determine the
relative value of stock prices (using earnings as a measuring point). 
It not not too simple.

The price/earnings ratio (for the S&P500 market as a whole this is
what is referred to by 'S&P earnings relative to the S&P500 index')
can therefore be a choice of:
1.  Price divided by historic earnings (i.e., todays price divided by
earnings last year - could be out of date)
2.  Price divided by earnings projected in annual reports (usually
reported as P/E ratios in FTSE and MSCI indices)
3.  Price divided by future earnings projected by the investment
bank's internal analysts (let's hope conflits of interests don't rule)
4.  Price divided by Concensus Foreceats (refered to as I/B/E/S on
financial graphs) which take the forecasts of earnings by Concensus
Economics - an independent organisation which survey and project
themselves to create a future estimate.

So while the principal of earnings relative to share price, what
earnings are, or rather will be (we are investing for the future) will
be a tricky game.  Simply taking an earnings number at face value
defeats the point of looking tothe future, and makes it important what
to regard as future value.

Earnings are not relative to an index - they are relative to a price
(which an index tracks).  All things equal, a price/earnings ratio of
8x is a good buy compared to a P/E ration of 16x, as the former allows
recoupment of investment cost sooner.

Earnings relative to index value is meaningless.  The meaning of an
index is that it simply bases a timeseries.  The number it is based to
(and hence grows from) is is arbitary.  Therfore any ratio of a real
number relative to an arbitary number is pointless.

patrickbatemandcom wrote, "Your answerer referred to the market cap,
but failed to address the question of earnings.

Patrick, I must reject your assertion that I failed to address any
aspect of the question.

The question asked, "Investment Banks talk about S&P earnings relative
to the S&P500 index (65 for 2004 expected on an index of 1150). I
would like to know that that means in absolute $ values for both the
total market cap and the earnings."

Thus, the question simply asked what "65 for 2004 expected on an index
of 1150" would mean in absolute dollars. As indicated in my answer
above, it would mean approximately $593 billion based on the $10.5
trillion market cap of the S&P 500.