Our team looks at a lot of research throughout each day. A few charts that caught our eye this week, and the way they fit the unfolding puzzle of evidence:
John Luke: Demand for labor continues to surpass economist expectations
Data as of 05.05.2023
John Luke: with a streak of “beats” not seen in recent decades
Data as of 05.05.2023
John Luke: This despite a significant contraction in money supply
Source: Deutsche Bank as of 04.30.2023
John Luke: and a commitment to quantitative tightening (QT) by our Federal Reserve
Data as of 05.03.2023
Dave: Where we’re NOT seeing contraction is in Q1 earnings results
Data as of 05.01.2023
Dave: quite different from 2022 when earnings estimates were cut repeatedly
Data as of 05.01.2023
Dave: but not strong enough to be described as “growing”
Source: 22V Research as of 05.01.2023
Dave: We’ve seen significant performance differences based on company size, with megacaps dominating and microcaps floundering
Source: PSC as of 04.30.2023
John Luke: perhaps partly driven by differences in operating margins
Source: PGM Global as of 04.30.2023
Dave: and many smaller cap companies lacking earnings entirely
Source: Strategas as of 04.30.2023
John Luke: These contrasting pieces of evidence continue to confuse investors, who still aren’t buying the Fed’s story about future rates
Source: Bianco as of 05.03.2023
John Luke: as seen by the 1/3 of polled investors who expect a cut at the July FOMC meeting
Source: FedWatch Tool as of 05.05.2023
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