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: It’s great to see actual yield available for the first time since before the financial crisis
Source: BlackRock as of 01.03.2023
John Luke: though the other side of that is a significant cut into the relative value of stocks vs. bonds
Data as of 01.18.2023
Brad: Also working against equities is the emerging reduction in earnings estimates
Data as of 01.19.2023
Brad: at a time of record profit margins
Data as of 01.18
Brad: This sets up a potentially tough outlook for stocks, at least until we see earnings estimate bottom
Data as of 01.19.2023
Dave: We’ve finally compressed enough to reach the average valuation of recent decades
Source: Bianco as of 01.17.2023
Joseph: with small cap stocks slightly chipping into their historically wide discount to large caps
Source: Strategas as of 01.17.2023
Brad: The bounce in equities in recent months has been led by foreign markets
Data as of 01.19.2023
Joseph: partly driven by the different makeup of foreign equity markets vs. the US
Source: Strategas as of 01.17.2023
Brad: In general, the bounce since the fall has been rather muted relative to historic bear market bottoms
Source: Strategas as of 01.18.2023
Brad: with gold bouncing just as much as the S&P 500
Source: Strategas as of 01.18.2023
Brad: with the year-to-date bounce looking like simple mean reversion after a rough 2022
Source: Strategas as of 01.19.2023
John Luke: Going forward, it’s possible earnings will reclaim a role as a key market driver
Data as of 01.13.2023
John Luke: while we wait for the Fed and the bond market to reconnect their views about the future path of policy
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