Executive Summary: Characterizing the investing backdrop at this juncture are big unknowns about the near-term future, such as which administration will be controlling fiscal policy six months from now and what monetary policy will be at that time. So

Many investors are wondering whether the recent outperformance of the S&P 400 MidCaps and the S&P 600 SmallCaps (i.e., the “SMidCaps”) and the equal-weighted S&P 500 reflect a sustainable broadening of the bull market to include more than mostly the largest-cap stocks. Or is it a temporary

Executive Summary: Investors in the stocks of big banks are looking forward to the earnings boosts likely in a lower-interest-rate environment, and their optimism has fueled nice share price momentum. The S&P 500 Financials sector lags only tech-related sectors

Executive Summary: As investors position portfolios for lower interest rates, Eric takes the pulse of goods producers, which stand to benefit from a lower-interest-rate environment more than services providers. … Melissa travels to India, where Prime Minister Modi just

Executive Summary: Would a Republican sweep in November boost the federal deficit? The Republicans would certainly extend Trump’s 2017 tax cuts beyond 2025. But they might also rein in federal government outlays. In any case, the initial reaction of

Executive Summary: In congressional testimony last week, Fed Chair Powell sounded more dovish than he has this tightening cycle. That clinched financial markets’ growing expectation that the Fed would cut the federal funds rate as early as September. We

Executive Summary: With today’s unusual housing market dynamics undercutting the affordability of new homes, homebuilders are offering buyers sales incentives. So far, they’re working to companies’ advantage, Jackie reports: Lennar’s May-quarter revenue and earnings both jumped around 9% y/y.

Executive Summary: A sea of troubles for European economies—including sagging growth, political headwinds, and an EC crackdown on fiscal miscreants—reinforces our Stay Home (versus Go Global) equity investing bias. … Chinese companies are evading US import tariffs by funneling

Executive Summary: We don’t think the Fed ought to lower interest rates this year, unlike many who rest their case on the rising unemployment rate. The BLS’s household measure of employment has been falling since November even as the

Executive Summary: Signs that the Fed might lower the federal funds rate soon have sent stocks soaring, even though those signs were weak economic data. So the Fed Put is back. We’re concerned that the Fed might ease too

Executive Summary: With this year half over, it’s time to look at which S&P 500 sectors and industries embody Wall Street analysts’ highest expectations for earnings rebounds next year. Jackie has the data and discusses what’s been going on

Executive Summary: Personal consumption expenditures data for May suggest clear skies on both the inflation and income fronts: The PCED has been gliding steadily earthward and looks on course to reach the Fed’s 2.0% y/y destination for it by

Executive Summary: Jackie has been mining information from earnings conference calls for insights into industry and economic trends. For example, air freight demand is unexpectedly strong as a result of shippers’ Red Sea travails; that and the end of

Executive Summary: The European Union is trying to rein in bloc nations’ budgets just as protectionist parties swell in European elections. Rising fiscal and political risks are weighing on European asset prices. We expect those headwinds to be tailwinds

Executive Summary: The federal budget deficit is far higher than typical during economic expansions—and current estimates are likely too low. The deficit is unlikely to shrink anytime soon absent a debt crisis, and it’s increasing the supply of US

Executive Summary: The bull market has stampeded through some of the most optimistic price targets on Wall Street including ours. While we are sticking with our S&P 500 yearend target of 5400, we’re looking forward to the bull run lifting

Executive Summary: The stocks of homebuilders, which rallied sharply over the past two years, have stalled over the past two months. Jackie takes a look at the recent earnings reports of Lennar and KB Home. Affordability is a problem that

Executive Summary: Indicators that often accurately signaled that a recession is on the horizon have missed the mark. Eric takes a look at why the economy has continued to thrive despite numerous Fed interest rate hikes and a plunging

Executive Summary:  The rates of unemployment and inflation aren’t always inversely correlated, as the Phillips Curve model posits. Historically, they have often been; in recent times, not so much. The problem with the model is that it doesn’t account

Executive Summary: As expected, the Fed opted not to lower the federal funds rate at yesterday’s FOMC meeting, but participants’ median economic projections changed considerably since March and now suggest only one cut this year (though we expect none).

Executive Summary: We expect global economic growth to continue to muddle along, neither booming nor busting, through 2025. Today, we review the key economic indicators we monitor to assess the strength of global growth, including world production and exports,

Executive Summary: We expect that Wednesday’s FOMC decision will be to maintain the federal funds rate at its current high level, where it’s been for nearly a year. Today, Eric discusses the higher-for-longer phenomenon, including why this tightening cycle

Executive Summary: How the labor market is doing is critical to the Fed’s setting of monetary policy given its dual mandate to steer the economy away from both too-high unemployment and too-high inflation. But gauging how the labor market

Executive Summary: Supply and demand are out of whack in the US housing market, Jackie reports, with unusual forces bearing upon the inventory of homes for sale, home prices, mortgage rates, and affordability. If something’s gotta give, it may

Executive Summary: Today, Joe recaps Q1 results for the S&P 500’s 11 sectors. Record highs in revenues, earnings and profit margins were scarce for reasons of seasonality, but improvements were broad based. More sectors than not logged y/y growth

Executive Summary: Fed officials lately have been talking a lot about “r*”—that ideal level of the federal funds rate that would represent just enough restrictiveness for economic growth without undesirably high inflation or unemployment. R* would be a great

Executive Summary: Our economic and S&P 500 forecasts are underpinned by our forecasts for corporate revenues, earnings, and profit margins. We often compare them to industry analysts’ consensus estimates for S&P 500 companies in aggregate and how they change

Executive Summary: OPEC+’s power over the oil market isn’t what it used to be. As non-OPEC producers from various countries drive up global production, the cartel must decide whether or not to extend the production cuts it started implementing two years

Executive Summary: The US economy has been evolving, and it’s time to retire some old rules of thumb about how it works. Sources of financing have diversified so much, Eric reports, that banks’ lending standards imply less about credit conditions

Executive Summary: Geopolitical events can shake up the stock market, sometimes providing buying opportunities. The current geopolitical landscape is unsettled and unsettling, with potentially seismic ramifications on several fronts and lots of uncertainties: Is Putin’s call for negotiations with