The opinions expressed below are my own and do not necessarily represent those of Visdom Investment Group, LLC.
Settling down
Overseas markets were quiet and our followed suit. The S&P opened slightly down and gently rolled lower and higher a few times over the day, finishing about flat. News wasn’t market-moving and much of the chatter on the street concerned Snowmageddon hitting 2/3rds of the country this weekend. Yields came in small across the curve and capital flow was just above normal, 103%.
The excitement of the Greenland episode is now over (hopefully) and investors are either happy to move on to usual concerns and/or calmly waiting for the next catalyst. Next week, earnings season really ramps up and perhaps market attention will focus on the wave of corporate results soon. 103 S&P 500 stocks report next week so as long as geopolitical headlines remain tame, there will be a lot for equity investors to delve into.
Here is some data regarding earnings season so far.
45 S&P 500 stocks reported
37 beat EPS estimates, 8 missed
Beta-adjusted:
Underperformance is the unspoken reality of reporting stocks so far. This is very unusual. Beats of expectations continue to stack up but many disappointing stock returns are due to disappointing guidance. So far, published estimates for S&P 500 earnings going forward continue to climb. Growth for the next 2 years is estimated to be 15% and 14%. As long as those numbers don’t drop, that will attract more longs.
We’ll see if next week’s reports preserve the view of the future or not.
See you Monday, have a great weekend, stay warm and safe.
-Mike
Visdom Market Commentary
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