US MARKET CALL: MTM & Chips' Profit Margin Distorting S&P 500 Earnings, But FEMO Lives On!

I. Stocks

Stop the music! S&P 500 earnings per share (EPS) have been significantly distorted by huge capital gains on investments by Alphabet and Amazon and a tax-related gain from Meta. Because GAAP accounting rules force companies to record unrealized equity gains and losses directly on the income statement, a small group of tech and venture-heavy mega-caps can create significant noise in the S&P 500's aggregate earnings growth numbers, masking the underlying operating trends of the broader market.