Paid DEEP DIVE: Pessimistic Consensus Jan 20, 2023 6 min read paid It’s hard to be a contrarian for very long these days because the consensus seems to change so quickly. At the end of last year, there seemed to be widespread agreement that the first half of 2023 would continue to be bad for stocks as the Fed continues to raise interest rates and the market discounts a recession during H2-2023. The bear market in stocks was expected to continue Ed Yardeni
Public Industry Analysts Trimming Earnings Jan 19, 2023 1 min read Industry analysts continue to trim their estimates for S&P 500 earnings for each of this year's four quarters (chart). They may continue to do so if company managements provide cautious earnings guidance during the current earnings reporting season. Nevertheless, as of the January 12 week, the analysts still expected that earnings will increase 4.0% this year compared to last year from $219.46 per share Ed Yardeni
Paid Surveys Say NY & Philly Manufacturing Weak Jan 19, 2023 1 min read paid Stock prices tanked yesterday following reports showing sharp declines in December's retail sales and industrial production. As a result, the Citigroup Economic Surprise Index (CESI) fell to -24.7 (chart). The 13-week change in the 10-year US Treasury yield (in basis points) is highly correlated with the CESI and it continued to drop yesterday. On Tuesday, January's NY Fed business survey was much weaker than we Ed Yardeni
Paid US Consumers Depress Stock Investors Jan 18, 2023 2 min read paid Bond prices rallied and stock prices fell on renewed worries about a consumer-led recession following the release this morning of December's retail sales and industrial production. Both declined last month. Yesterday, the NY Fed's regional business survey for January was also very weak. (We will review it tomorrow along with the Philly Fed's latest regional business survey.) Let's have a closer look Ed Yardeni
Public Inflation Is Falling Jan 18, 2023 1 min read Interest rates fell sharply today on news that December's PPI confirmed that inflation is falling rapidly. The PPI inflation rate plunged from almost 18.0% y/y in mid-2022 to 6.2% by the end of the year (chart). Both the goods and services components of the PPI are disinflating. The PPI includes indexes for personal consumption based on prices received by the providers of the goods and Ed Yardeni
Public Dr Ed's Video Webcast 1/18/23 Jan 18, 2023 1 min read Consensus economic views seem to be mostly pessimistic. Big bank CEOs are preparing for a mild recession. Americans are skittish about a downturn, most economists project a recession, and lots of investment strategists remain bearish. But not us: Below is exclusive early access to Dr Ed's Webcast for paid members. This post and video will open to the public on a later date. We don’t foresee recessions Ed Yardeni
Paid Getting Technical Jan 17, 2023 1 min read paid Here is Joe Feshbach's latest trading call: "The market has rallied according to plan accompanied by improving breadth numbers. The put/call ratio has moved back to neutral (chart). I would’ve preferred more skepticism on the rally. So while the market should eventually get to the upper end of its trading range it could get a bit bumpy soon. The chart I alluded to last week Ed Yardeni
Paid The Economic Week Ahead, January 17-20 Jan 16, 2023 2 min read paid We expect that more of the Fed's talking heads will be talking this week about monetary policy perhaps with a bit less agreement of what needs to be done next. They only have three days to do so before the FOMC blackout period begins. The Q4-2022 earnings reporting season continues this week. More important than the quarter's results will be managements' guidance for this year. Ed Yardeni
Paid Federal Net Interest Outlays: Time to Worry? Jan 16, 2023 1 min read paid The latest federal budget data were released last week. Over the past 12 months through December, the deficit was $1.4 trillion with outlays of $6.3 trillion and receipts of $4.9 trillion (chart). Among the fastest growing outlays is net interest paid by the federal government. It soared to a record $517.7 billion over the 12 months through December (chart). Ed Yardeni
Public Young Bull Market? Jan 13, 2023 2 min read Last year, we thought that the S&P 500's bear market might have bottomed at 3666 on June 16, when sentiment was as bearish as it was when the index bottomed at 666 on an intraday basis on March 6, 2009. We were wrong. It fell to a new low of 3577 on October 14. We viewed that as a successful retest of the June low. So Ed Yardeni
Paid What's In Style? Value, SMidCaps & Global Jan 12, 2023 2 min read paid The S&P 500 is back testing its 200-day moving average (chart). It previously did so on November 30, but failed to move higher. It might succeed this time if the current Q4-2022 earnings reporting season isn't disappointing relative to expectations. The S&P 500 equal-weighted index continues to outperform the S&P 500 market-cap weighted index (chart). More stocks are participating in the recent Ed Yardeni