The treasury yield curve, crude and copper are seriously worried about prospects for the economy. Not the sell-side, which continues to expect a banner year – both 2023 and 2024 – for S&P 500 operating earnings. Odds heavily favor their … Continued
The fed funds rate has gone up more than 450 basis points since last March, and more tightening is on the way. This is yet to sufficiently make a serious dent in consumer inflation, even as economic data particularly surrounding … Continued
With two consecutive weeks of rallies, major US equity indices closed last week right at/near crucial resistance. This is taking place even as companies are getting ready to report 4Q22 earnings, which over the last multiple weeks have been persistently … Continued
Leading up to the 4Q22 earnings reporting season, the sell-side continues to wax enthusiastic about this year’s earnings prospects. The enthusiasm looks improbable considering the meaningful rise in interest rates last year is all set to filter through to the … Continued
Small-caps are lagging. With a large domestic exposure, these companies offer a reliable way to take a pulse of the economy. Rates have gone up a lot and will rise even more. A recession is imminent next year. Large-caps’ recent … Continued
The 3Q earnings reporting season just began. Revision trend has been down. Given the tightening monetary policy and the deteriorating outlook for next year, it is possible managements begin to lower guidance for next year, bringing into question the sell-side’s … Continued
Next year’s earnings estimates for US companies peaked in April for large-caps and in June for small-caps. Given Powell’s resolve to significantly reduce the current four-decade-high inflation – no matter what the cost to jobs and the economy – the … Continued
The 1Q earnings season begins in earnest this week, with a host of financials getting the ball rolling. For large-caps, this year’s revision trend is flat to slightly up, but next year’s is decidedly up, which is kind of interesting … Continued
For the second time in five weeks, the S&P 500 charted out a bullish weekly hammer. Sentiment readings are suppressed, although non-commercials are at risk of being too bullish. Near-term, the path of least resistance is up – magnitude and … Continued
VIX flashed a spike reversal last week. If history repeats itself, this probably means downward pressure on volatility, and higher stock prices. This is near term. Medium- to long-term, it will take time to heal the technical damage inflicted this … Continued