Ed Yardeni

This Week: January 8 - 12

Jan 10, 2024 2 min read

The second week of the month tends to be light on economic releases compared to the other weeks of the month. However, it usually includes the CPI. The Cleveland Fed Inflation Nowcasting is projecting that tomorrow's headline and core CPI inflation rates for December will both be up 0.3% m/m. We are thinking that the headline might be closer to zero given that gasoline prices continued

Ed Yardeni

Dr Ed's Video Webcast 1/10/24

Jan 10, 2024 1 min read paid

The point between Fed tightening and easing is a good time to reconsider the widely accepted long-and-variable-lags theory of monetary policy. Is the economy still vulnerable to recession from the lagged effects of the 2022-2023 tightening round? We don’t think so. The markets have already started to ease, which should offset some lagged tightening effects. Furthermore, lagged tightening effects don’t invariably cause recessions. Our work shows that recessions

Ed Yardeni

Fourth Quarter's Earnings Reporting Season Begins

Jan 9, 2024 2 min read paid

The new year is about to begin with an earnings reporting season for the last quarter of the old year. We've been optimistic on the outlook for earnings because we expected the economy to remain resilient and grow despite the Fed's aggressive tightening of monetary policy over the past two years. So we were pleased to see that S&P 500 operating earnings per share

Ed Yardeni

NVIDIA Leads The Way

Jan 8, 2024 2 min read paid

Nvidia led the stock market higher today after the world's most valuable chipmaker announced new desktop graphics processors taking advantage of artificial intelligence. The company's stock climbed 6.4% to end at $522.53, its highest close ever (chart). Nvidia's rally boosted the PHLX Semiconductor index by 3.3%. Semiconductors and related technology companies are benefitting from the enthusiasm about AI. Is it hype?

Ed Yardeni

Market Call: What Should We Root For?

Jan 7, 2024 2 min read

Both the bond and stock markets didn't do much on Friday following the release of December's employment report and NM-PMI. The former looked better-than-expected at first, but not as strong in the details (and downward revisions of the previous two months), and wage inflation was higher than expected. The NM-PMI was weaker than expected led by an unbelievable (literally) drop in its employment sub-index down to

Ed Yardeni

What's Next?

Jan 4, 2024 2 min read paid

Rollercoaster rides are unnerving on the way up and then thrilling on the way down. Stock markets are thrilling on the way up and unnerving on the way down. The market had a thrilling meltup late last year and a slightly unnerving selloff during the first three days of the new year. Last year's yearend rally has fizzled so far this year. That's mostly because investors

Ed Yardeni

Bad Apple?

Jan 3, 2024 2 min read paid

The MegaCap-8 stocks led the S&P 500 down during the first two days of trading in 2024 (chart). The moves came after Barclays downgraded Apple on Tuesday and lowered its price target for shares of the company on fears of slowing iPhone 15 sales in China. We warned you about companies with exposure to the weak Chinese economy on December 26 in our QT titled "Prepare For

Ed Yardeni

DEEP DIVE: Another Year Of Living Dangerously

Jan 3, 2024 6 min read paid

The Roaring 2020s has been a wild decade so far. During 2020, we all had to deal with the first wave of Covid. During 2021, we had to deal with another wave or two of Covid. During 2022, Russia invaded Ukraine, inflation soared, and the most widely anticipated recession of all times remained widely anticipated. During 2023, that same story played out for most of the year but with a

Ed Yardeni

Dr Ed's Video Webcast 1/3/24

Jan 3, 2024 1 min read paid

How likely is the stock market to have a down year in 2024? Since down years tend to be associated with recessions, and since a recession is unlikely now that inflation has been approaching the Fed’s target, and since the Fed looks more likely to ease than not, it’s hard to see the stock market ending 2024 lower than it began. Our last Morning Briefing of 2023 provided

Ed Yardeni

Fairy Godmother Of The Bond Market

Jan 2, 2024 2 min read paid

When Janet Yellen was Fed chair from 2014 to 2018, we often referred to her as the “Fairy Godmother of the Stock Market.” We noticed that stock prices tended to rally following her speeches and testimonies on monetary policy and the economy. She has been Treasury secretary since 2021. We may start calling her the “Fairy Godmother of the Bond Market.” That’s because the rally in the bond market

Ed Yardeni

The Economic Week Ahead: January 2–5

Jan 1, 2024 2 min read paid

We made it through another year of living dangerously: 2024 is here! The first week of the new year is unlikely to bring any surprises on the economic front. Most of the indicators will provide insights into the labor market and consumer spending on autos and houses: (1) November's JOLTS report (Tue) should confirm that there are still more job openings than unemployed workers. We know that from

Ed Yardeni

Happy Old & New Years!

Dec 31, 2023 2 min read paid

The S&P 500 rose 24.2% last year after falling 19.4% during 2022 (chart). Since the start of the data in 1928, years with gains of over 20% were followed by years of 5.9% gains on average. Excluding recession years, the second-year gains averaged 9.7%. Losses during recession years averaged 10.1%. Down years for the market are more likely than not to be associated

Ed Yardeni

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