Stock Market

Revaluing Earnings

Jul 30, 2022 1 min read paid

In the past few weeks, industry analysts started to shave their S&P 500 earnings forecasts for this year and next year. Last Wednesday, the Fed raised the federal funds rate by 75bps to 2.25%-2.50%. On Thursday, we learned that real GDP fell for a second quarter in a row marking a technical recession, though a mild one so far. So, naturally, the stock market has

Ed Yardeni

US Regional Business Slowing; Inflation Peaking

Jul 29, 2022 1 min read

July's national manufacturing purchasing managers index (M-PMI) will be released on Monday. Will investors cheer it? The regional business surveys conducted by five of the 12 Federal Reserve district banks suggest that the M-PMI should fall closer to 50.0 from June's 53.0 (chart below). The M-PMI's prices-paid index, which remained very high at 78.5, should also moderate somewhat, according to the

Ed Yardeni

Summer Rally

Jul 27, 2022 1 min read

We've been making the case that June 16 might have been the bear-market low in the S&P 500 when it closed at 3666.77. It was up 2.6% today to 4023.61, a 9.7% gain since last month's low. Today's performance was especially impressive. Instead of focusing on Fed Chair Jerome Powell's hawkishness on inflation at his press

Ed Yardeni

Industry Analysts Shaving S&P 500 Earnings Estimates

Jul 25, 2022 1 min read

The industry analysts who cover the S&P 500 companies are starting to lower their earnings estimates for 2022 and 2023. Consider the following: (1) They haven't cut their estimates by much, so far, but enough to flatten S&P 500 forward earnings after it rose to a record high four weeks ago. (Forward earnings is the time-weighted average of analysts' consensus earnings estimates for

Ed Yardeni

S&P 500 Sectors: Reversals Of Fortune

Jul 16, 2022 2 min read

The S&P 500 fell 23.6% from January 3 to June 16. It is up 5.4% since then through Friday's close. Is this just a short-covering rally in a bear market? We will be discussing this topic in Monday's Morning Briefing. For now consider the following: (1) So far, the stock market’s rally since June 16 has been led by the biggest

Ed Yardeni

Copper, Gold, Bonds & Stocks

Jul 12, 2022 1 min read

The ratio of the nearby futures prices of copper to gold has been falling lately. The ratio has been a remarkably good indicator for the 10-year US Treasury bond yield.

Ed Yardeni

S&P 500 Sectors: Latest Performance

Jul 10, 2022 2 min read paid

Will the Da Vinci Code be right again in calling a major market bottom? The S&P 500 fell to 666 on an intra-day basis on March 6, 2009. That devilish number marked the bottom in the previous bear market. On June 16 of this year, the S&P 500 closed at 3666, down 23.6% from its record high on January 3. That marked the bottom to

Ed Yardeni

S&P 500 Energy Earnings Still Energetic

Jul 8, 2022 1 min read

The S&P 500 Energy sector has been weak recently, but it is still the only one of the index's 11 sectors with a gain so far this year at 28.0% ytd. Here are a few quick takeaways: (1) The price of a barrel of Brent crude oil has been volatile around $100 recently and looking toppy. The outlook has become extremely controversial. On July 1,

Ed Yardeni

The MegaCap-8’s Impact on the S&P 500

Jul 5, 2022 2 min read

The MegaCap-8 stocks were also the Magnificent-8 during 2020 and most of 2021. Their businesses greatly boomed during the pandemic when many people worked, schooled, and entertained at home. The MegaCap-8 include Alphabet, Amazon, Apple, Meta, Microsoft, Netflix, NVIDIA, and Tesla. During H1-2022, they lost a lot of their magnificence and market capitalization, and weighed heavily on the S&P 500. Let’s review their rise and fall: (1)

Ed Yardeni

S&P 500 Gives Back 2021's Gain

Jul 3, 2022 1 min read

The S&P 500 fell 20.6% during H1-2022 (table below). That's on the edge of a bear market , which is defined as a 20%+ decline. Here are a few more quick takeaways: (1) Of the 11 S&P 500 sectors, only Energy was up, and several industries were down by 30% or more: Energy (29.2), Utilities (-2.0), Consumer Staples (-6.8), Health Care

Ed Yardeni

Bears Are Waiting for Something to Break

Jun 29, 2022 2 min read

Investors Intelligence Bull/Bear Ratio (BBR) remained under 1.0 during the June 28 week at 0.82 for the ninth consecutive week. It has been bouncing around 1.00 since late February. In other words, it hasn't worked as a short-term contrarian indicator given that the S&P 500 has been falling since it peaked on January 3. However, the BBR might have signaled at least

Ed Yardeni

A Good Relief Rally

Jun 24, 2022 1 min read paid

What a relief to finally have a good relief rally in the stock market. Consider the following: (1) The S&P 500 was up 6.4% this week, and 6.7% since it bottomed on Thursday, June 16 at 3666.77. It was down 23.6% back then from its January 3 record high. Now it is down 18.4% from that peak. (2) The S&P 500&

Ed Yardeni

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