Second quarter GDP forecasts start to come back to earth
Not so long ago major economic forecasts such as the GDPNow forecast from the Atlanta Federal Reserve Bank were calling for second quarter U.S. GDP to grow at an annual rate of better than 4%. That was extraordinarily strong growth and it fit in with forecasts from...
My baseline U.S. stock market scenario for the next 30 days
So much negative uncertainty from big possible events. Such strong short term earnings fundamentals. How will these all balance out? Before I get to my take on the answer to that question let's take a brief stop to look at what a baseline scenario is and why putting...
Saturday Night Quarterback says (on a Sunday), For the week ahead expect…
...another week in the battle between fear of the macroeconomic dangers of President Trump's tariff war and optimism over the approaching earnings season. Normally, I'd say the odds in this contest would favor earnings optimism. But thanks to the calendar--and the...
Adding Microsoft to my Jubak Picks portfolio–hoping for a July “miss” like that in April
As I wrote in Part 3 of my Special Report "Investing in a Late Cycle Market," I'm adding Microsoft to my Jubak Picks portfolio. The April third quarter earnings "miss" sets Microsoft up for a huge fourth quarter when the company reports on July 19. Plus whenever this...
GOOG gets hit by market profit margin fears even after good earnings
Some times in the financial markets, the numbers aren’t as important as the narrative. I think that was the case with Alphabet (GOOG) today, Tuesday, April 24. Monday after the market close Alphabet reported first quarter earnings of $9.93. That was a healthy 64 cents a share above the Wall Street consensus estimate for the quarter. Revenue climbed 25.9% two $31.15 billion. That was $870 million above Wall Street projections. Paid clicks on Google properties rose 59% year over year. But Tuesday the stock sank by 4.45%, dropping $47.47 a share to $1019.98 Why the drop on such good earnings numbers?
Saturday Night Quarterback says, For the week ahead expect…
This week I expect the rotation from worry to relief over the Trump administration’s tariff policy and a potential trade war with China to stay in control of the narrative. Next week we’re likely to shift to earnings stories as companies begin to report really good first quarter earnings. After a couple of weeks of that we’ll either slide back to the trade narrative or start to get ready for the Federal Reserve narrative surrounding a June invest rate hike.
Rethinking 2018: Growth looks marginally slower, risk higher even in first half
It’s only March but I’m rethinking my take on 2018.When the calendar pages turned over into 2018, my take on the year was that for stocks the first half would be much like 2017: Despite rising interest rates from the Federal Reserve, there was enough earnings growth to move stocks up even from near record highs. The bond market would be more problematic with those interest rate increases keeping downward pressure on bond prices and upward pressure on bond yields. With inflation still relatively quiescent, though, the downward trend in bond prices would be relatively gradual. It was the second half of the year that investors had to worry about, I thought then.
This is as good as it gets, says Goldman Sachs: Why that’s important to you in thinking about the next leg in this stock market
On Thursday February 22, Goldman Sachs said in a note to clients that the economic macro data as likely to be “as good as it gets.” This isn’t, in my opinion, a call for an immediate plunge in the markets. But with U.S. stocks trading near all time highs, I think the Goldman note is something all investors need to take seriously. Or at least the question it raises needs to be taken seriously. Here’s the question: If stocks are at all time highs and the economic data on economic growth, inflation, interest rates, etc. are as good as they’re going to get for this cycle, why should stocks move higher?
Saturday Night Quarterback says (on a Sunday), For the week ahead expect….
There will be lots and lots of head-scratching going on this week on the cause of last week’s drop in U.S. stocks. Causation is important here for all of us who are trying to figure out whether this was the start of something big or if the 3.85% drop for the Standard & Poor’s 500 index from the high is just a short-term correction.
PayPal beats on earnings and revenue, but falls after hours on profit taking
PayPal Holdings (PYPL) reported fourth quarter earnings of 55 cents a share, 3 cents a share above Wall Street estimates, and revenue of $3.71 billion (on a foreign-exchange neutral basis) vs projections for $3.63 billion. Revenue climbed 24% year over year for the...
Netflix rally on earnings tells us more about how complacent this market is than about Netflix
This market remains determined to rally as we head into earnings season. Look no further than the reaction to earnings from Netflix (NFLX) for evidence. The stock market could have reacted to yesterday’s earnings from Netflix (NFLX) by selling down the shares. Could have. But didn’t.
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