Recent Commentary

This earnings season (Q2) is still very young, but beat rates in both revenue and profits are well above average. Yet share-price reactions to earnings reports may be suggesting that the good news is already priced in – at least in the short-term. We are seeing quite...

Since the stock market’s 18.9% pullback during the tariff-tantrum in early April, it has had one of the fastest rebounds on record. The S&P 500 is up more than 10% in Q2 (which includes ugly April).  The tech-heavy Nasdaq 100 is up about 18% and semis are up more...

Investor sentiment soared in May along with stock prices.  According to a recent AAII survey, the percentage of bullish respondents rose to 37.7% versus 20.9% at the start of May.  Bears dropped from nearly 60% at the start of the month down to 36.7%.  These are big...

Earnings season has been strong. The results could have sparked more bearishness, but instead have generally been a sigh of relief.  Of the companies that have reported so far, an above-average 73% beat earnings estimates, and 63% beat sales estimates.  In terms of...

IS IT ONLY TARIFFS? The blame for the market’s drop lies squarely on the shoulders of tariffs.  During the period when the markets recently rallied from March 14th through March 25th, there was very little “tariff talk.”  When 25% auto tariffs were announced last...

Here are our final thoughts on the just completed earnings season for Q4 ’24. Both the EPS and revenue beat rates were very solid.  Of course, earnings are, in part, a lagging indicator.  They don’t necessarily tell us much about what happens next.  Guidance helps...

One of the risks equity investors face is “headline risk.” Headline risk is being surprised (blindsided) by a bad news headline.  It can be stock specific or relate to the entire market.  Yesterday, investors got a dose of headline risk with news that a Chinese...

The S&P 500 has had a 20%+ return for two years in a row. It has only rallied 20%+ in back-to-back years three other times in history.  Last year’s advance was mostly smooth without a 10% correction along the way.  The ‘Mag 7’ now account for a third of the...

With an YTD gain of 22.1% through yesterday, the S&P 500 is on pace for its second annual 20% gain in a row. Surprisingly, that has only happened two other times:  first, three times in a row from 1954-56, and second, four years in a row from 1995-98.  However,...

China may be our biggest adversary, but the health of their economy and markets are important to the U.S. They are a major trading partner and their markets contribute to overall global stability. Chinese policymakers are finally alarmed enough to shift out of low...