The VIX Has It’s 4th Lowest Close (9.75)

The weak jobs report was ignored by the stock market on Friday. The S&P 500 was up 0.37% and the Nasdaq was up 0.94% bringing both to a new record high. The small correction at the end of May was a great buying opportunity as the S&P 500 is up 3.5% since then. This ‘buy…

Margins Might Not Expand In The Next Few Quarters

The stock market closed at a new record high on Thursday. The main reason for this rally is seen in the chart below. It shows year over year quarterly operating earnings growth since 1995. The mini-decline in earnings growth in 2015 and 2016 is like the one in 1998. Earnings growth had been sinking prior…

BLS Report Shows 138,000 Jobs Created

The ADP May private sector jobs report on Thursday signaled a great BLS jobs report would come on Friday. Sometimes the ADP report doesn’t indicate how the BLS report will be. This was one of those months as the BLS report was bad across the board. It looked like the online job listings report that…

Are Economic Earnings Weakening?

The last article was about corporate earnings. There are many ways to measure earnings. The top measurements are GAAP results and operating earnings. As I have shown in past articles, the BEA’s measurement of corporate profits shows lower growth than bottom up GAAP analysis. The BEA’s estimate is a top down analysis which looks at…

Earnings Beat Rate Was 74.01% In Q1 (Highest Since At Least Q2 2013)

In this article, I will discuss some more of the details of the aggregate earnings reports as of May 22nd. Unsurprisingly, energy is the sector which is expected to have the highest projected annual 5-year earnings growth rate. This isn’t surprising because the sector is starting from a low base. Some of that growth is…

Online Jobs Ads Indicate Weak Labor Market

I like to look at every type of economic metric in doing research. The current environment is somewhat unprecedented in a few ways. One of those ways is the jobless claims stats. The jobless claims 4-week average hit a 44-year low which makes no sense because the labor market has expended. Considering unit labor costs…

Amazon, Apple, Netflix, & Facebook Have Almost Identical Performance

In this article, I will review the latest earnings data as reported by S&P Dow Jones Indices. There was a two-week break in the data as the purveyor of it went on vacation. It’s always great to get a clear view of the bottom up earnings without any filters. Before I get into that information,…

GDP Growth Estimate Raised to 1.2% In Q1- Still Anemic

The first revision to Q1 GDP was released Friday. This is the report I was waiting for ever since the 0.7% growth report was released a few weeks ago. I have said that it’s important to take each first guess at GDP growth with a grain of salt because the number is subject to revisions.…

Stocks Up Dollar Down

Looking at the major stock market indexes it looks like the market has not cared that the U.S. macro surprise index has been negative while the European macro surprise index soars. Looking in more detail, there has been an underlying trend in markets which reflects the economic shift. The Russell 2000, which consists of firms…

The Unwind Policy Gets More Detailed

The Fed’s Minutes surprised many as it gave details about the balance sheet unwind. It was a smart idea to give some of the details since the FOMC has come to an agreement on the policy. Janet Yellen will have a press conference after the June meeting. Journalists and bankers can digest the new policy…